Rising gas prices and 2005

Soaring gasoline prices and concern about Iraq have bolstered demand for fuel-sipping hybrid cars, some of which were collecting dust at Southern California dealerships as recently as last fall.

But it will take more than $2 a gallon prices to shake local drivers' hold on gas guzzling sport utility vehicles. Their sales remain strong, although certain models are becoming less popular.

Regional sales of hybrids, which combine an electric motor with a gasoline engine, reached record levels in February, as more consumers were willing to pay a higher sticker for savings down the road.

Regional Toyota Motor Corp. dealers sold a record 303 Prius hybrids last month, up from 191 in February 2002. The company expects the sales trend to continue throughout the year.

American Honda Motor Co., which didn't provide a monthly or regional sales breakdown, said it anticipates selling a record 25,500 Civic and Insight hybrids this year, up from 16,200 in 2002.

"Three months ago, we couldn't sell (hybrids)," said Chafi Khadjehnouri, sales manager for Honda of Santa Monica. "Now we're selling those cars with a mark-up?"

The dealership has a waiting list of five people who want hybrids, he said. "As soon as we get them, they sell?"

Honda and Toyota--both of which base their North American sales and distribution headquarters in Torrance--are currently the only two car makers producing hybrid vehicles.

Slow to debut

American carmakers have lagged in the hybrid category.

Ford Motor Co. plans to introduce a hybrid Escape SUV, which should arrive on dealership lots next year. General Motors Corp. will transform its Saturn model into a hybrid by 2005.

There is interest in the Escape, but a lot of people still like the SUVs, said Tawny Arnaud, vice president of sales for North Hills-based Galpin Motors Inc., the world's largest Ford dealer by volume.

Ford and GM have relied on financing incentives to lure shoppers since late 2001.

Even the Japanese carmakers expect SUV sales to keep rising.

Honda expects to sell more than 200,000 Cr-V and Pilots this year, after national sales of the two SUVs totaled 198,328 last year.

Toyota's five SUVs are holding steady trend throughout the region - 3,252 sales last month, down slightly from 3,286 in February 2002.

The vehicles remain particularly popular among families with several children. "It's cheaper to buy one SUV than two cars," Arnaud said.

Automobile industry executives cite the high price of gasoline as a chief reason why drivers who can get by with two or four seats are considering hybrids.

"It's directly proportionate to the price of gasoline," said John Hanson, a Toyota spokesman. "People who are buying these vehicles want something that is economical?"

Toyota's $21,000 Prius is only slightly more expensive than its least expensive SUV, the $20,000 Rav4. But the hybrid gets 52 miles-per-gallon in the city as compared to 22 mpg for the SUV.

Southern California sales of the Toyota's Rav4 SUV fell to 532 last month, from 623 in February 2002.

Nevertheless, Prius buyers pay more than a comparably equipped Corolla, for instance, despite a $2,0000 tax deduction offered to hybrid users.

An increased awareness of hybrids is also playing into consumers' choices. "More people realize they don't have to plug them in," said Kurt Antonius, a Honda spokesman.

This year, manufacturers have not made enough hybrids to keep up with the demand. But they said they would take a wait-and-see approach before increasing volumes significantly.

"The inventory is lower than we would like' Antonius said. "But we want to see if this is a temporary situation in the market, or does it reflect a long-term continued growing demand for hybrids."