As consumer demand is declining, President Barack Obama's administration decided to accelerate federal purchases and has bought nearly a fourth of the Ford Motor Co. and General Motors Co. hybrid vehicles since he took office. Bloomberg acquired sales data under a Freedom of Information Act request.
It found out that the US General Services Administration, which manages the government fleet, purchased at least 14,584 hybrid vehicles in the past two fiscal years -- about 10% of 145,473 vehicles the agency had bought for that period.
In comparison, hybrids made up less than 1% of government purchases in fiscal 2008. Hybrids have been in the market for more than a decade and so far, they have not been broadly accepted. That is why the government seeks to boost investment in this technology. For the third straight year, consumer sales of hybrids have been falling.
In addition, government agencies and businesses have said that they will also buy all-electric models being launched by carmakers including GM.
Jeff Schuster, director of forecasting at J.D. Power & Associates in Troy, Mich., said that at some time in the future, the technology has to be accepted and it has to be accomplished “without a government crutch.”
But he says that there won’t be a natural demand unless the government buys more of these vehicles or if there’s a huge gas-price hike. [via autonews - sub. required]