Americans are rushing to buy hybrid cars. They’re turning to Asian brands to do so

(CNN) — All it took was $4 a gallon gas to make Americans embrace hybrid cars. But with limited offerings from the big Detroit automakers, people are turning to their Asian rivals in droves.

Korean automaker Hyundai reported Thursday that hybrid sales rose 39% in the third quarter, while Kia’s hybrid sales more than doubled, rising 152% percent. Japanese automakers also reported exceptionally strong hybrid sales in the quarter, with Toyota sales 29% and Honda up 21%.

Gas prices have soared since the start of the war with Iran in late February. American car buyers are now seeking out more fuel-efficient cars, like hybrids. But unlike their Japanese and Korean counterparts, most American automakers sell very few hybrid vehicle lines.

“It just stresses how important it is to have the right product at the right time, but you can’t predict that nearly as well as you would like,” said Ivan Drury, director of insights at car buying site Edmunds.

Sales of pure electric vehicles, however, have fallen sharply over the past year. They are more expensive than gasoline-powered cars, even more so following the end of a $7,500 tax credit for EV buyers last September. Tesla, the nation’s largest EV maker, reported Friday that third quarter sales fell 2% from a year ago. EV sales were off across the industry.

But hybrids, which use a combination of gas engines and electric motors, are much more affordable.

“I think that this is one of the most clear-cut examples of how consumers are going to find that going with a hybrid is going to fulfill their needs far more conveniently, and at the lower price point than an EV,” said Drury.

The sales boost from hybrids nearly allowed Korean automakers to overtake Ford in US sales for the first time ever. Hyundai and Kia posted combined sales of 506,200, rising 5.4% from a year ago. Ford, the third largest American automaker by volume, saw its sales fall 6.6% to 509,764, according to figures from the company Friday. (Because Hyundai owns a significant stake in Kia, most analysts count them together when ranking sales.)

Ford lost its title as the second largest US automaker to Japan’s Toyota in 2007, part of a decades-long trend of Americans ditching the Big Three Detroit companies – Ford, General Motors and Jeep and Chrysler-maker Stellantis – for Asian automakers. Asian brands first make significant inroads into the US market during the oil price shock 50 years ago, and were clearly helped by the latest gasoline price spike.

Asian automakers sold more than half of all the new cars during the quarter, according to Cox Automotive. US companies clocked a record-low share.

“With the (Detroit automakers) having limited hybrid powertrain options and few passenger car offerings, this trend seems likely to continue,” said Charlie Chesbrough, senior economist for Cox Automotive.

For decades, Detroit’s Big Three like Ford have discontinued lines of fuel-efficient sedans and smaller cars to produce large SUVs and trucks with higher profit margins. And before the war in Iran, American shoppers had no problems buying larger, fuel-hungry vehicles.

But as the national average surges above $4 per gallon, Americans are giving new attention to fuel efficiency when car shopping. And American companies have few options.

Ford only has one hybrid midsize pickup, the Maverick, and discontinued its hybrid Escape SUV. Sales of all versions of the Escape were down 85% as its supplies of the car on dealers’ lots dwindled. GM has only one hybrid model, which is a version of its niche Corvette sports car. Stellantis announced in January it was phasing out its plug-in hybrid models in North America with the 2026 model year. While both Ford and GM plan more hybrid models in coming years, it takes time to change course.

The sales results come just days after the Trump administration announced new, less stringent fuel efficiency requirements for automakers.

That may save the Detroit automakers money in terms of fines if they miss mileage targets. But a lack of fuel-efficient models, like hybrids, can hurt long-term growth if buyers go elsewhere, Drury said.

“The momentum that the Big Three have given up is tremendous,” he said. “Repeat purchases is the lifeblood of automotive industry. If you lose somebody, clawing them back is the hardest thing you can do.”

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