Clean Green Cars: Incentives: How Japan and the U.S. create different green car markets

Incentives: How Japan and the U.S. create different green car markets

For the last two months in Japan, hybrid vehicles from either Honda or Toyota have actually managed to outsell all other vehicles, regardless of what’s powering them. Here in the States, though, Honda is reporting that it’s unable to sell as many Insight hybrids as it had hoped. What’s up with that?

According to Earth2Tech, the issue is with incentives. It seems that Japan has both wide-ranging subsidies to spur the sale of fuel efficient vehicles along with harsh penalties in the form of expensive fuel for choosing gas guzzlers. Here in the U.S., there may be similar programs in place, but they are not nearly as beneficial to highly fuel efficient vehicles.

For instance, hybrids like the Honda Insight and Toyota Prius are completely tax free in Japan. In contrast, U.S. tax rebates for hybrids have been all but completely phased out due to the seemingly arbitrary 60,000 limit for incentives per hybrid vehicle manufacturer.

When it comes time to sign on the dotted line, it would seem that relatively inexpensive fuel in the U.S. and a general lack of federal incentives mean that hybrid vehicles just don’t pay back their increased sticker price quickly enough for most consumers in the States to justify their purchase.

Gallery: 2010 Honda Insight