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Ford's profit spotlights fuel-saving cars
Hybrid cars
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Kai Ryssdal: Oh to be Ford CEO Alan Mulally today. This morning, Ford reported its quarterly profits rose an astounding 22 percent. That's a nifty $26 billion in the bank for Ford. The last time that company made as much money in Q1 was back in the days of the SUV boom.
But smaller cars led the way this time. Rising gas prices do tend to concentrate the consuming mind. Ford's not the only one profiting.
Toyota dealers are having a hard time keeping up with demand for that very symbol of fuel efficiency, the Prius. Factor in a production slowdown from the earthquake in Japan and used Prii are selling at a premium, too.
Marketplace's Alisa Roth reports.
Alisa Roth: There are the regular sales commissions. And then there are these: Toyota of Hollywood is paying employees a $500 finder's fee for every used Prius they bring in.
Don Mushin: Salesmen can go on Craigslist, they can go on Autotrader.com, they can go into the newspaper. Anywhere they can find a used Prius, we'll buy it.
Don Mushin is the general manager there. A lot of people want fuel-efficient cars right now. And there's a Prius shortage because of the earthquake. And Mushin says has to have something to offer Prius buyers.
Tom Santospago runs a Toyota dealership in Maine. He stocked up on used Prius models earlier in the year. But he's afraid that by mid-summer, he won't have any left at all. He says Toyota realizes it's a big problem.
Tom Santospago: They're telling us to call our lease customers, move them ahead a year, move them ahead two years, move them ahead six months, get them out of their car and take their car in trade.
But it's not clear where he's supposed to get new vehicles to replace them.
Jonathan Banks follows the used car market at the National Automobile Dealers Association. He says prices on used Prius models are up 30 percent since the beginning of the year. That's more than for other used cars, though those are also in high demand.
Jonathan Banks: Prices have accelerated on all the fuel-efficient vehicles since mid-March and we're attributing some of that to the anticipation that inventory will be tighter from the production disruptions in Japan.
With gas prices still going up, it could be a long summer for Toyota dealers and buyers chasing ever fewer Prius cars.
I'm Alisa Roth for Marketplace.
With the increasing demand of cars due to the rising gas prices, the desire to save money, and the move towards a ‘greener’ environment, I think manufacturers are going to have a hard time keeping up with the demand; thus, driving prices even higher. I noticed that, not only the cars are getting more expensive, but also the auto parts and accessories, which could also mean that people are either using used cars, thus, they would be upgrading the old-looking car parts. I would say that with the current demand of the cars and accessories, it is unlikely that prices will go down.
