Hybrid sales revving up in Minnesota

Driven by pocketbook and environmental concerns, more Minnesotans are putting their feet to the gas-electric pedal in hybrid cars. Sales of the cars, which combine a gasoline engine with an electric motor and batteries to reduce emissions and improve mileage, nearly doubled in Minnesota through the first seven months of the year, according to a survey released Monday by industry researchers R.L. Polk & Co. of Michigan.

Kilb Norgaard was among those who made the switch. The Chanhassen real estate salesman bought a Toyota Camry hybrid that he could use to drive his clients to house showings.

"Conventional cars are throwing off too much carbon dioxide," said Norgaard, who wanted to combine green technology with amenities such as a leather interior and a sun roof. "Hybrids are more environmentally friendly, and you're still getting a nice car for $30,000."

According to Polk, 3,576 new hybrid vehicles were registered in Minnesota during the first seven months of this year, up 98 percent from the same period of 2006. Nationally, hybrid sales were up about 49 percent to 215,997 through July, according to the survey.

The Midwest region was the nation's biggest gainer, with sales up nearly 57 percent through July, the Polk survey showed. Sales rose at a faster rate in Minnesota than in other Midwestern states, but in numbers Minnesota ranked fourth in the region, behind Illinois, Ohio and Michigan -- home to the U.S. auto industry.

Why the rise?

"Fuel prices were certainly a factor, and Toyota was the main beneficiary, since the growth mainly came from Prius and Camry," said Lonnie Miller, Polk's director of industry analysis. "The Midwest is always a strong market for midsize sedans."

Minnesota ranked 19th in the nation in hybrid purchases, accounting for just under 2 percent of the vehicles sold through July. California was the leader, with nearly 55,878 hybrids sold during that period, or 26 percent of the total.

Through the first six months of this year, hybrids accounted for 2.3 percent of U.S. new light-vehicle sales, according to J.D. Power and Associates.

In Minnesota, hybrids still make up a tiny proportion of motor vehicles. Last year, Minnesota had 4.2 million passenger vehicles and pickup trucks alone, according to Department of Public Safety records. If every hybrid car sold in Minnesota since 2000 were still on the road, there would be about 9,200 of them, according to the Polk statistics.

And hybrids still lag behind another green technology, flexible-fuel vehicles that can run on E85, a blend of 85 percent ethanol and 15 percent gas, as well as other gasoline blends. There were an estimated 150,000 flex-fuel vehicles in Minnesota as of summer 2006, the Commerce Department said.

The biggest hybrid seller in Minnesota this year has been the Toyota Prius, which accounted for about 55 percent of hybrid sales in the state through July. Nationally, the biggest sellers were the Prius (50 percent), Camry (15 percent) and Honda Civic (9.1 percent.)

Hybrids that did not sell as well during the first seven months of the year included larger models such as the Toyota Highlander and Lexus RX400h, Polk said.

In addition to Toyota, Honda and Lexus, hybrids are offered by a number of other carmakers, including Ford, GM, Mazda, Mercury, Nissan and Saturn.

The federal government offers tax breaks for hybrid purchases; the breaks generally have phaseout provisions tied to the sale of 60,000 vehicles. In the case of the Prius, as the credit has declined, Toyota has begun offering incentives, which have helped maintain a strong sales pace, a J.D. Powers forecaster said last month.

Mileage and quiet

Steve Owens of St. Michael bought a Prius last winter after being on a waiting list for a year and a half. He did it for better gas mileage.

"I'm in sales and I wanted an efficient car to drive," said Owens, who works for Avery Dennison Co., a maker of labels. "I was driving a Ford Ranger pickup that got 20 miles to the gallon, but now I'm getting nearly 50 miles per gallon with the Prius."

Norgaard, meanwhile, says he has been getting 35 to 40 miles per gallon with his Camry, but it took him awhile to get used to the sound of its electric motor.

"I tried to lock the car and it wouldn't let me," Norgaard said. "Then I realized the car was still running, but it was so quiet I didn't notice it."

Steve Alexander • 612-673-4553

Steve Alexander • alex@startribune.com