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Despite Ridiculous Gas Prices, Toyota Prius Interest Declines

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On: Wed, Apr 20, 2011 at 2:55PM | By: Chris Weiss

Despite Ridiculous Gas Prices, Toyota Prius Interest Declines

Last week, survey results from research firm TNS demonstrated how public views on certain brands affected (or not affected but thought to be affected) by the natural disasters in Japan were leading consumers away from Japanese brands like Toyota and Honda. Consumers were wary of parts shortages and worried that prices would rise too much when compared with vehicles not so directly affected.

Well, of course, such ruminations are bound to extend beyond brands; people buy models, not brands, after all. According to some market research by Edmunds, consumers are starting to look away from the Toyota Prius, even as gas prices rise to historic levels.

Edmunds' research shows that interest in the Prius has fallen over the past month, in terms of those researching the car on their website. That time period roughly correlates to the post-earthquake period in which automakers have had to cut production because of auto parts shortages related to earthquake damage. The earthquake in Japan took place on March 11.

Prior to the earthquake, Edmunds' research shows that consumer interest in the Prius was on a steady incline, likely due to increasing gas prices. Interest peaked around the time that events started in Japan and has been steadily declining ever since. Meanwhile, gas prices have continued to rise on their way to $4 per gallon.

The Prius provides an interesting case study into the minds of consumers. While soaring gas prices have become an increasing concern among consumers, other considerations such as rising vehicle prices, parts shortages, and bad press have seemed to displace gas as driving factors, at least temporarily.

The Toyota Prius is the EPA's 2011 non-electric efficiency leader with a 50 mpg combined rating. However, it's also one of the cars expected to be most affected by the production problems in Japan. Dealers have already begun removing incentives on the car, effectively raising prices.

Moving ahead, it will be interesting to watch how consumer attitudes evolve in the face of opposing forces. Gas prices are at the $4 mark in six states—California, New York, Illinois, Connecticut, Washington D.C., Hawaii, and Alaska—as of this week and $3.83 across the nation. Some economists are predicting that they'll average $4 nationwide by the summer.

During the next month and a half, Toyota will only be running Japanese production at 50 percent of original plans. Supplies of the Prius and other Toyota vehicles are likely to dwindle, with Auto News estimating that Toyota will lose 120,000 cars during that time.

Will Prius interest continue to slide? Or will consumers move past Toyota's struggles and choose the Prius in light of ceiling-less pump prices? Will $4 gas or auto-industry problems be the bigger news story in the months to come? Will decreasing interest in the Prius cause supplies to steady and incentives to be put back into place?


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