Apr 14 - Knight Ridder/Tribune Business News - Matt Nauman San Jose Mercury News, Calif.

Consumers want their green cars to be very green. High-mileage hybrids such as Toyota's Prius and Honda's Civic are winners, but just being a hybrid isn't enough.

Honda said Thursday that it might trim production of its Accord Hybrid because of slow sales. And Ford said last week that it's offering no-cost financing to boost sales of its Escape and Mercury Mariner hybrid sport-utilities.

Sales of hybrid cars and SUVs grew just 7.5 percent in March compared with the same month in 2005, despite the arrival of three new models plus a completely redesigned Civic Hybrid over the past year.

Through the first three months of 2006, hybrid sales were up 37 percent, compared with January to March 2005. That's impressive growth at a time when the overall auto market is up just 1.1 percent.

But sales of gas-electric vehicles grew 97 percent from 2003 to 2004, and 140 percent from 2004 to 2005, reaching 205,749 units last year.

Honda dealers sold 581 Accord Hybrids in March, compared with 29,623 non-hybrid Accords.

"We've had to re-evaluate our position," Honda Executive Vice President Dick Colliver told reporters at the New York International Auto Show, according to the Associated Press. "It's having a hard time in the market."

Among hybrid buyers, two clear favorites have emerged. The Toyota Prius accounted for more than half of all U.S. hybrid sales last year, and topped 100,000 in sales for the first time. And Honda said it expects to sell 25,000 units of its Civic Hybrid this year. Both cars emphasize vastly improved mileage over gas-only vehicles -- a combined 55 city/highway mpg for the Prius, and 50 mpg for the Civic.

Others, such as the Accord and the new Lexus GS 450h, are touted by their makers as offering superior performance coupled with some fuel economy gains.

Price premiums on those models have been "artificially high," said Jesse Toprak, executive director of industry analysis at edmunds.com, and early adopters and those wanting to make a statement by buying a hybrid already own one.

"Now you're going after the mass market, and that's a roadblock," he said. "The mass market won't care about image as much. They care about practicality -- how much it costs, how much they'll save in gas."

The news of a sales growth slowdown comes just as several new models are set to arrive. The Lexus GS 450h, a hybrid sports sedan, goes on sale this month. A hybrid version of the Toyota Camry arrives in May.

Later in the year, hybrid versions of the Nissan Altima sedan and the Saturn Vue SUV will be introduced.

Prius sales were down in March, but Toyota spokesman Sam Butto attributed that to production issues as the automaker gets ready to start building the Camry Hybrid.

Toyota Sunnyvale sells 15 to 20 Highlander Hybrids a month, but it still has a 330-customer waiting list for the Prius, said owner Adam Simms. Miles per gallon is the key, he said. "Over 40 is wow in the consumer's mind, 30 is not."

Industry analyst J.D. Power and Associates continues to forecast strong growth for hybrid models. It predicts hybrid sales will exceed 800,000 by 2013. By then, U.S. consumers will be able to pick from 52 different hybrids, said Power forecaster Anthony Pratt.

The Power Information Network, which tracks dealer transactions, reports that the average Civic Hybrid sold for $23,141 in March and the average Prius sold for $26,480.

Other hybrid vehicles were much more expensive, with the Ford Escape and Honda Accord both selling for more than $29,000, the Highlander topping $37,000 and the Lexus RX 400h at nearly $46,500.

California continues as a hybrid hotbed. Owners of the Prius, Civic and some older Honda Insight models can get stickers that allow them to drive solo in the carpool lane on state highways. Hybrid buyers also qualify for tax credits from $250 to $3,150, based on a vehicle's fuel economy, weight and emissions.

At Honda of Stevens Creek in San Jose, the Civic Hybrid has proved much more popular than the Accord. "Of course, because it can go in the commute lane and the fuel economy is a lot different," said Niko Malakis, the dealership's sales manager. Shoppers who look at the Accord Hybrid tell him they were "expecting something with higher mileage."

According to the government's www.fueleconomy.gov Web site, the Accord Hybrid gets a combined city/highway rating of 28 mpg, which is the same as the four-cylinder, gas-only Accord.

"You could arguably get just as well or better fuel economy with a four-cylinder gasoline Accord for $8,000 to $10,000 less," Pratt said.