Hybrid Car Review

The latest survey of car executives finds them optimistic on further growth in the hybrid car marketplace.

Global sales of hybrids will surpass 700,000 in 2008, compared to between 500,000 and 600,000 in 2007 according to 43% of those surveyed. Last year, 88% said gas-electric hybrids would gain in market share.

KPMG LLP asks senior automakers worldwide (they had 113 responses) to predict the future of the auto industry. 81% predicted higher market share for low-cost and entry level cars. Optimism was higher than in the past, with 26% predicting industry profitability will rise in the next five years, as compared to 16% last year.

"This industry has seen the bottom of the market and is focused on the
future, investing in new technologies and production efficiencies, with a
continued focus on product quality," said Daron Gifford, National Automotive
Industry leader for KPMG LLP. "Increased competition is fueling higher levels
of optimism. Many execs in our survey are seeing the light at end of the
tunnel with respect to the turnaround prospects for North American OEMs."

Still 54% of those surveyed are predicting North American brands to lose market share, while only 22% are predicting an increase. Those numbers are better than last year, 62% and 14% respectively.

Key issues facing the auto industry according to those polled are quality (96%), reducing costs (86%) and new technologies (83%, an increase from 68% last year).

Executives also believe car buyers are changing their behavior, ranking quality (86%), fuel efficiency (84%), safety (70%) and afford ability (70%) as the most important attributes. New fuel sources is on the rise, hopping from 53% to 65%.

"Clearly the fuel prices are driving the consumer's decision in the vehicle," said Betsy Meter, KPMG's automotive audit sector leader.