Spinning Green Wheels

Rebate seals the deal for some hybrid buyers

RACHEL DE LAZZER

For Zulfiqar Hyden, the federal budget's promise of an extra $2,000 tax rebate on the purchase of a Honda Civic Hybrid seals the deal.

The 45-year-old consultant with Deloitte Canada has been car-shopping for a few weeks and the hybrid was already high on his list, he said.

Then came yesterday's news that the new federal budget provides for varying rebates for consumers who buy fuel-efficient vehicles (and levies that penalize purchases of gas-guzzlers). The highest rebate available, $2,000, will go to hybrid vehicles including the Toyota Prius and the Honda Civic Hybrid -- and that's on top of the $2,000 rebate already offered by the Ontario government on similar vehicles. (Highly fuel-efficient conventional autos can claim smaller amounts.)

"Initially I went in to buy an ordinary car, but when we looked at the difference in emissions and the extra mileage that's available on a hybrid, that definitely makes the case," Mr. Hyden said.

"But the additional money from the government sort of seals it," the Mississauga resident said.

Vanessa Nobrega, 26, and Mark Ellingson, 28, were shopping yesterday at a downtown Toyota dealership. They are looking into buying a Toyota Yaris, a fuel-efficient small car that would earn a $1,000 rebate.

For them, even $4,000 in combined federal and provincial rebates for a hybrid can't quite change their minds, although they think it would for a customer with more to spend.

"The price difference is still $15,000," Mr. Ellingson said.

Prices for the Honda Civic Hybrid start at about $26,250, while the Prius starts at about $31,000.

"If the Prius was the same price, we'd definitely go for the Prius -- or even if it was close," Ms. Nobrega said.

At Mississauga Honda, about one or two Civic Hybrids have been moving off the lot every month -- at least until last month, when sales picked up, said Errol Walker, the dealership's manager of new cars. Last month, the dealership sold 23 of the vehicles, a jump Mr. Walker attributes partly to the recent rise in gas prices after a gas shortage.

The formula presented in yesterday's budget for calculating rebates and penalty levies uses a vehicle's fuel efficiency based on a combined rating: 55 per cent of the city fuel consumption rating and 45 per cent of the highway rating.

The budget imposes a special levy to be paid by manufacturers and importers of vehicles that can't travel 100 combined city-highway kilometres on less than 13 litres of fuel -- excluding pickup trucks and autos that use alternative fuels.

A Ford Grand Marquis will be dinged for $1,000, while dealers will see a $4,000 surcharge on each Hummer or BMW M5.

Source: The Globe and Mail