Prime time for more Toyota plug-in hybrids?

While they might make sense scientifically or as part of a bigger strategy, PHEVs do have their drawbacks.
No matter which energy source it’s using at any given moment to propel itself, a plug-in hybrid is essentially hauling the other portion around as dead weight, explains Sam Abuelsamid, principal analyst leading e-mobility research with Guidehouse Insights.

“Pricing is a challenge. PHEVs are going to be significantly more expensive than just a standard hybrid, primarily because you have a bigger battery, plus you also need a more powerful motor, more powerful electronics,” said Abuelsamid, a former automotive engineer. “Architecturally, they’re largely the same as a conventional hybrid, but to really benefit from it, you have to up-size things like the motors and the power electronics so you can actually drive it on electricity alone.”

That bears out with Toyota’s two current PHEVs. The Prius Prime, introduced in 2016 and with a battery-only range of 25 miles, starts at $29,215, including shipping, a $3,695 premium over the Prius hybrid. The RAV4 Prime, which went on sale last year, can drive 42 miles on battery alone, and it starts at $39,275, a $9,450 premium over the RAV4 Hybrid.

Toyota sold 14,698 Prius Primes in 2020 in the U.S., down 33 percent from 2019, while the automaker sold 3,200 RAV4 Primes in its first year on the market.

While automakers have begun flooding the market with high-profile BEVs, the number of plug-in hybrids is shrinking.

According to the U.S. Department of Energy’s Alternative Fuels Data Center, automakers offered 47 PHEVs for the 2020 model year but just 35 in the 2021 model year.

Part of the reason might be the smaller regulatory benefit that PHEVs receive relative to full battery-electric vehicles, Abuelsamid said. Automakers can earn more than four times the zero-emission vehicle credits per vehicle for each battery-electric they manufacture vs. a comparable plug-in hybrid. Said Abuelsamid: “For companies like [Stellantis], which doesn’t have BEVs on the market, or Toyota, whose only ZEV is the Mirai [hydrogen fuel cell vehicle], they can at least earn some credits selling PHEVs.”