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Toyota lost money on every first generation (1999-2003) Prius they sold. They claim they are now making money on the car.
No one knows just how much it actually costs to produce a Prius. But the fact that they are making more and more hybrids indicates they are making some money.
Untrue. The following is from an October 2003 story in Automotive Industries Magazine. The "current generation" Prius they refer to is the first generation car:
While the rest of the automotive world is struggling to make a business case for hybrids, Toyota Motor Company is making money. According to Toyota, the last few month's worth of the current generation Prius brought in a small profit (industry insiders say about $1,100 dollars per vehicle).
http://www.ai-online.com/Adv/Previous/show_issue.php?id=308
http://www.jalopnik.com/cars/news/prius-production-starts-in-china-143284.php
Now add the TCH from Japan and KY plus production of the Prius in China plus the units licensed to Nissan and they may be approaching 500,000 units annually.
What a discussion they must be having on the boards over there comaparing a Chery to a Prius and trying to justify the extra cost.. whoowheee
I have seen other statements about the profitability of the Gen 1 Prius late in its life. They were actually posted here about 3 years ago when this very same point came up, and was debunked. Urban legends die hard sometimes.
I have seen other statements about the profitability of the Gen 1 Prius late in its life. They were actually posted here about 3 years ago when this very same point came up, and was debunked. Urban legends die hard sometimes."
Maybe you should re-read the article; I read it in 2003.
I remember the debate about profitability of the Gen1, and I remember that I disagreed that it made money for Toyota. The Gen 1 was heavily subsidized when it was introduced, and I doubt it ever made money.
However I will grant that Toyota claimed it made money at the end. I just don't believe them. For one thing, I doubt that Toyota ever recouped the investment costs (even up to the current date). So the question is how do you define making money...
The Gen 2, on the other hand, should have made Totyota some money. I have not seen Toyota number to prove this theory. But as I said before, they wouldn't have expanded hybrids if it was losing that much $$.
So I think my answer to correct; the Gen 1 was not a profitable vehicle for Toyota. OK, let's accept Toyota's claim of end-of-gen1 sales. How many months did it lose $$ as opposed to those few months it made 1100 per vehicle? Add that to the investment costs and it was a major money loser.
Gen1 Prius, Gen2 Prius, 400h/HH, Estima van, Crown/Camry hybrid, Others??
If development and R&D was $100 Million (?) $300 Million (?) the amortization over 500,000 vehicles by the end of this year ( yr 10 ) would be $200/ veh and $600/ veh respectively.
Now is the variable cost to make these hybrids significantly higher than a standard ICE? On that I have no clue only guesses.
Less cost:
No traditional transmission
More cost:
Battery pack
MG1 + MG2
PSD
Hybrid Warranty
I agree with you steve that the Gen1's ( future unknown ) were likely loss leaders. Now I'd be surprised if every hybrid vehicle didn't return a close to normal profit/return.
There are well-defined GAAP policies to cover that, which Toyota and any other company must follow or risk getting in major trouble.
Toyota invested for the future with the first-gen Prius. The fact that they were making money on those cars before the end of that generation is quite an achievement I think.
GAAP deals with how a company reports or accounts for their money. I don't doubt that the R&D was listed separately from the production costs of the Gen 1.
http://www.electric-scooters-galore.com/2000x.html
i'll just see if anything is ever said about it.
family harmony...
------------------
A national finance magazine is looking to interview consumers who are looking to purchase a hybrid vehicle and are looking at it from a financial standpoint, hoping to save money from the high cost of fuel. Please send an e-mail to ctalati@edmunds.com no later than Saturday, June 10, 2006 by 5:00 PM PT/8:00 PM ET containing your daytime contact information and the hybrid vehicle you are considering.
Thanks,
Chintan Talati
Corporate Communications
Edmunds.com
No, there is no special paperwork - all you need is your sales agreement.
The IRS form involved is a work-in-progress right now, but as noted in the previous post, there is nothing special to do here except fill out your 1040 correctly and claim the credit.
On a golf trip to Oregon (I'm from Ca) I had my nav prog set up for all my POI's (points of interest). 2 days before the end of my trip my display module proceeded to "spaz out" on me. I dropped in at a dealership in Eugene, Ore and they referred to a TSB that described everything I witnessed. I returned to home and had a new one ordered (warranty). Presto! Works great. I had 29,500 miles on the odo when it happened. Without the display you can't get the mapping, no A/C temp control (only max A/C from steering wheel), no radio setup and errant message displays. I also had my emerg brake rubber pad replaced (not normally a warranty item). So if you start getting weird readings on the display module, check with your dealer, takes about a week to order and 2 hrs to install. I just got my notice for the steering column retrofit.
Thanks,
Rich
For the most part, I pushed the vehicle fairly hard -- keeping it in cruise at 55/60/65 (100/90/80 kph in Canada) as posted. Of course there were a few bumpy stretches where I had to slow down, and a few construction areas with loose gravel where I did 20/30 mph. My overall mileage (per computer) was 48.6 before I started the trip (2500 miles on odometer), it now says 49.9. So I averaged over 50 mpg. I still need to compute mpg based on fillups.
While the Alcan is mostly paved, it is far from being a good highway. Maybe 30% very good, 40% bumpy, 29 % rough, and 1% with long stretches of loose gravel in construction zones.
I've got a few rock chips in the hood, just above the 3M clear-bra line. One bad one left a small dent, courtesy of an oncoming semi that didn't feel the need to slow down much over a loose gravel stretch. While the 3M bra certainly prevented a lot of chips, I would recommend to anyone considering a purchase to ask their installer to cover as much of the hood as possible. I have 4 or 5 small chips just above the line (some prior to the trip), and a couple just below the line (prior to installation of clear bra).
Oh, the trip was GREAT!!! Saw tons of wildlife (eagles, puffins, black bears, brown bears, moose, caribou, buffalo, Dall sheep, wolves, humpback whales, orcas, seals and otters) and numerous glaciers.
One last thing....I purchased the Monster iCarCharger for my iPod nano just before the trip. It works great (no feedback loop). I loaded most (AAC format) of my CD collection onto the iPod the night before the trip. I put the iPod into album shuffle mode. When I turned the car off, all I had to do was hit play after restarting and the iPod picked up where it left off. Never repeated a song (except the ones that occurred on more than one album). There were some long stretches with no radio stations, so the iPod came in quite handy.
One sour note -- no navigation data for Alaska. I guess GPS satellite data can't be picked up very well that far north, so Toyota (and I think all of other manufacturers) didn't bother to load Alaska map data into the car. Now in reality, I was getting some GPS data in southern Alaska, but I only checked it a couple of times. It seemed to work for the most part in the Yukon on the Alcan, so I think it would work to some degree in southern Alaska. The Toyota dealership said there are supposed to be new satellites next year that will allow GPS to work in Alaska, at which time one could load map data for Alaska.
BTW, I liked the Toyota dealership in Fairbanks, but they forgot to make adjustments in air pressure on the tires after rotation. I didn't discover this until I reached Seward.
GPS works fine all the way to the Arctic. I don't think the roads are up to date in the mapping software. Most hunting guides and bush pilots use GPS exclusively. They set their own map points. It is a great tool for not getting lost fishing and hunting. I get 4-5 birds in Prudhoe Bay with my cheapie antenna for my laptop. Our Garmin gets 5-7 most places.
Sounds like you had a nice trip. And it did not cost you an arm and a leg for gas.
Maybe Toyota, or the SW company providing the map data, just decideed to exclude Alaska. Poor GPS reception may just be their patent excuse.
P.S. Prius can Free-us @ the pump.
Anyway good to see you posting... Gary
No issues at all as yet. I'm 50/50 with investing in the 7/100 VSA insurance policy before the 36000 limit comes up in Dec.
Fuel usage is now consistently at about 1.96 gpc ( 51 mpg ) since the weather warmed.
P.S. I was impressed with Toyota's SCION X..clever unit. Very smart & practical.
Package #1 Prius? You musta got the only one. I got my Package #4 at $450 over invoice as a close out employee price and it was ~$23800
The 'base' TCH is just under $27000.. the max price on the TCH is $30600 with everything on it, including Navi, leather, etc.
My trusty GMC Sierra hybrid gets all the miles except to church when we pull the Lexus out of the garage. I sold the Passat diesel. I had mixed emotions as I liked the mileage and it was fun to drive. It was just too tempting to try and make money on a year old car. So now I am getting 15 miles to the gallon on the truck. I like it though. Very quiet and it has XM radio with a fancy Bose system. I will drive it until a midsized diesel truck or SUV comes along.
I think you did hit it lucky with your Prius. Toyota is keeping them out like a carrot on the end of a stick. If you have a product that people want and won't settle for anything else you can get away with that.
I did dump the Badyear tires in favor of Costco Michelin Xs - better in every way.
Just to clarify, the 16 Cu ft includes the hatch area, you were referring to the advantage of having a hatch instead of a sedan, correct?
Your statement would seem to indicate that the Prius has 16 cu ft without using the hatch area, which is not correct.
I chose the Prius over the Camry hybrid because it has 16 cubic feet of cargo space, vs less than 11 for the Camry. It ALSO has a hatchback, which is superior for my purposes to a conventional trunk opening.
OK?
What you get in a Prius is real room for 4 adults [great back seat legroom], plus real cargo space, plus easy access to same, in a package that takes up about the same space on the road as a Corolla. Plus 40-45 mpg driven like any other car, which is the way I drive it.
The Camry is the better driver - no question about that. But we take too much stuff on a long trip to fit in a Camry hybrid - and the hatch has already paid off several times by swallowing stuff that simply wouldn't fit in a conventional trunk, no matter how large [like the flat panel TV that we brought home recently].
Wouldnt that be a kick in the balls for Toyota to have invested all that money in electric hybrid drive, only to have it become completely commercially obsolete? And think of all those electric hybrid owners stuck with obsolete technology unable to recover the money they gave to Toyota instead of Exxon.
The first part of your statement is false. The second part remains to be seen.
I wouldn't be worried about Toyota. The investment is likely to have been paid off already with over 500,000 vehicles on the road. How much could the development costs have been, $1Billion? ( highly unlikely ). Your concern for Toyota's well being is noted though.
To your last statement I see that you find it acceptable to pay extra money to Big Oil and the MidEastern countries like Iran, S Arabia rather to an auto employing US citizens which is one of our allies.
The government ( unofficially ) is perusing all your telephone records as of your last statement.
Far more people understand what a "full" hybrid is than you think, seeing right past your attempt to mislead.
The hydraulic hybrid system is a low-end "assist" design, so its abilities are quite limited.
For a purpose like UPS is testing, that could translate to a definite benefit. But what if you require A/C in that traffic with frequent stops? You're basically screwed. The engine must be run for that hydraulic-equipped system to keep you cool. In a "full" hybrid, that isn't the case since the A/C can be entirely electric.
And what about cruising, how long do you actually believe the hydraulic pressure will last? The "full" hybrid persistently recharges, so there is always an ample supply of electricity available. That allows the electric motor to be taken advantage of, even when on the highway. When will the hydraulic pressure be recovered and when/how can it be used?
JOHN
Actually I dont pay any great sum of money to anyone. Thats because I own a Toyota ECHO. (just paid $13 in fuel expences to drive it for 21 days) HA!
"...your attempt to mislead"
No I was trying to IMFORM not mislead. The Toyota Prius is not the only way to conserve. IMHO opinion the ECHO is by far the best bet out there. While the Prius saves gas (mostly in local traffic) it also gives your money to Toyota instead of the oil companies. How much better if 75% of our vehicles were like ECHOs? We wouldnt need $25,000 Prius's and the denand for gasoline would be what, half of what it is now? The price of oil would DROP! A cheap, simple, and highly effective solution. Thats not misleading either.
The "small car, cheap oil" situation you just described already happened.
Don't you remember that? It is how we got in this mess we are struggling with now. Let's not fall for the same cyclical trap again.
The 80's brought a flood of small cars. They were pretty efficient compared to the norm, very much like the suggestion you just made.
The price of oil went down. It stayed low. Automakers ended up taking advantage of that. The solution to the small profit the small vehicles provided was to increase the size. Consumers didn't complain. After all, the price of gas was cheap. The size continued to grow. It got out of hand... causing the very situation we are in now.
The re-emergence of small cars is starting that same cycle all over again.
Fortunately, some of us are aware enough to have noticed the pattern and the reality that efficiency alone is not a true solution. With hybrids brings reduced smog-related emissions too. That is not a selling feature of the small cars, which focus only on higher MPG.
The desire for a larger vehicle will compel people to abandon small cars after awhile anyway. Hybrid technology does require modest price increase, but with it you can continue to drive the bigger sedans and large minivans since they'll deliver greater efficiency and lower emissions. Isn't that the point?
JOHN