EV, hybrid owners flock to SUVs. What should be done?

EV, hybrid owners flock to SUVs. What should be done?

Itês not news that lower gas prices are causing consumers to lose interest in alternative fuel vehicles. But you may be surprised by the extent of it. And a federal panel says new pricing, improved technology and better consumer education would help revive EV sales.

An analysis by Edmunds.com found that 22 percent of people who traded in their hybrids and EVs in 2015 bought a new SUV. Thatês way up from 18.8 percent last year, and nearly double the rate of 11.9 percent just three years ago.

Only 45 percent of buyers trading their hybrids and EVs bought another alternative fuel vehicle, down from just over 60 percent in 2012 the first time that loyalty rates for AFVs have fallen below 50 percent.

From a strictly financial viewpoint, the shift makes sense. Edmunds calculates that at the peak average national gas price of $4.67 per gallon in October 2012, it would take five years to break even on the $3,770 price difference between a Toyota Camry LE Hybrid ($28,230) and a regular Toyota Camry LE ($24,460). At todayês average gas price of $2.27, it would take twice as long.

Many in Congress believe it is in the nationês interest to encourage EV sales. So members of Congress asked a federal panel, the National Research Council, to study the problem and make recommendations. The conclusion: Developing less expensive, better performing batteries is essential to lowering vehicle cost, and a market strategy is needed to create awareness and overcome customer uncertainty. The report recommends federal incentives to address these issues plus regulations to eliminate the problem of incompatible outlets at different charging stations.

Of particular interest to dealers: The report says the federal government should consider converting the federal income tax credit for buyers of plug-in EVs to a point-of-sale rebate.