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Study Shows Strong Consumer Consideration for Flex Fuel Vehicles Including E85 Plug-in Hybrids Peak Interest

DETROIT, Aug. 16, 2006 -- A new study by global market research company Synovate shows that 37% of US consumers would consider purchasing a Flex Fuel vehicle that runs on gasoline or E85 (85% Ethanol) the next time they are in the market to buy a car. However, more than a third of these same consumers lose interest in E85 Flex Fuel vehicles when they learn that there is a reduction in fuel economy.

This information came from Synovate's latest semi-annual survey of consumer attitudes toward advanced propulsion and alternative fuel vehicles.

"It certainly appears as if consumers have bought into the appeal of a Flex Fuel vehicle that can run on either gasoline or E85," explained Scott Miller, CEO of Synovate Motoresearch. "However, consumers also are largely unaware that they will experience a 25% loss in fuel economy when the vehicle is running on Ethanol. While we really don't expect this reality to impact sales of Flex Fuel vehicles, it will generate disappointment among enthusiastic buyers. It also means that E85 will have to retain a substantially lower price per gallon over gasoline for it to have any impact on consumption."

The study, conducted among 1,240 buyers and those intending to buy new light duty cars and trucks, also found that while awareness of hybrids is now very high among US consumers, consideration of a hybrid vehicle has flattened at just under 50%.

The biggest surprise in the study was the high consideration of grid- connected or "plug-in" hybrids. Familiarity with the technology is currently low but, after hearing an explanation of a grid-connected hybrid, 49% of consumers said they would consider purchasing one, roughly the same level of consideration as standard hybrid technology.

Grid-connected hybrids offer some unique advantages to consumers. According to Tim Englehart, Manager of Alternative Fuels Studies at Synovate Motoresearch, "Plugging the vehicle in at home means fewer trips to the gas station and lower operating costs. The unknown with this technology is the additional purchase cost. However, there is a considerable group of consumers who are willing to pay to get these unique benefits. It would also be an excellent way to transfer some of the country's dependence on oil to the national resources we use to power the electric power grid. We believe it's something to watch."

Diesel technology is a hot topic in the US and another focus of the Synovate study. Consideration among US consumers remains low at roughly half the consideration of hybrids. However, Miller says the numbers can be misleading. "The story around diesels is not the percent of US consumers who will consider it, just those who are very interested. Our data give us strong reason to believe that if manufacturers can meet the emissions requirements of the new diesel legislation, some are going to surprise the market with the products they introduce and the buyers to whom those vehicles appeal."

About Synovate

Synovate, the market research arm of Aegis Group plc, generates consumer insights that drive competitive marketing solutions. The network provides clients with cohesive global support and a comprehensive suite of research solutions. Synovate employs over 5,000 staff in 108 cities across more than 50 countries. More information on Synovate can be found at http://www.synovate.com/ .