From WSJ 2/6/2006 Now that America's addiction to oil is officially back on the political agenda, the auto industry is keen to direct attention to the growing number of vehicles offered with hybrid and other non-traditional power plants.

But just because a vehicle is a hybrid doesn't mean it's hot.

Honda this month began rolling out Version 2 of its Accord Hybrid, a variant of the V-6 Accord model outfitted with what Honda calls "integrated motor assist." It's not a hybrid the way the Toyota Prius is a hybrid. The Prius has essentially two motors, a four-cylinder gasoline engine and a battery-powered electric-drive system. Honda's Integrated Motor Assist, or IMA, system is more of a super-sized starter that boosts the performance of the gasoline engine and enables the gas engine to switch off when the car is stopped and idling. But the Accord system can't propel the car without the gas engine running, whereas the Prius can operate as a pure electric car at low, parking-lot speeds.

When it was launched in late 2004, the Accord Hybrid's selling proposition was that it offered the performance of a large-displacement V-6 engine (253 horsepower) with the fuel economy of a four-cylinder engine. For this, Honda hoped that consumers would pay something like $31,000, or roughly $8,000 to $9,000 more than the average Accord's transaction price, as measured from data collected by the Power Information Network.

Honda ran headlong into what I call the "Hybrid Calculator Conundrum." Anyone (including some journalists) armed with a simple calculator can run the numbers on how much fuel an Accord Hybrid will save compared to a standard Accord over a typical year's driving, figure the cost of that fuel, and then figure out how long it will take to recover the extra money spent on the hybrid versus a standard, four-cylinder Accord.

In the case of the Accord Hybrid, this calculation is simple. A four-cylinder Accord EX sedan with automatic transmission is rated at 24 miles per gallon in the city, 34 highway. The asking price, with leather seats, is $25,500. The Accord Hybrid's asking price, for 2006, is $31,540 with freight charges. The rated mileage for the redesigned car is 25 miles per gallon in the city, and 34 highway. (That's down from 29/37 city highway because the 2006 car is heavier.)

The consumer whose real priority is fuel economy won't save much if any gasoline in return for a $6,000 price premium. But they will be able to accelerate faster between stop lights.

This helps to explain why the Accord Hybrid, so far, has not had the success of the Toyota Prius, a car that is distinctively different from standard cars in its exterior look, and is engineered for high mileage.

Back in June and July, Accord Hybrids were taking an average of 35 days to sell, compared to just eight to 10 days for a Prius. In the fall, Honda launched a restyled standard Accord, but left the hybrid with the old body style. That slowed demand dramatically. Accord Hybrids sat for an average of 136 days before selling, according to Power Information Network data. Regular Accords turn over in 32 days.

The Accord Hybrid has been among the least-successful hybrid vehicles, but it's not the only hybrid that's not zipping off the lots as fast as the Prius. As of January, the Toyota Highlander hybrid crossover wagon was taking 29 days to sell, compared with 27 days for the average gas-only Highlander, which typically sells for about $9,000 less, according to Power Information Network. The hybrid Lexus RX400h is moving off the lot in an average of 25 days, compared with 24 for the regular RX330. The price premium for the RX400h is roughly $8,000.

Granted, a car that sells in less than 30 days is doing fine by the standards of the industry, where cars turn over in average of 57 days, according to the Power Information Network data. But Honda appears to recognize that it missed the mark.

In an effort to relaunch the Accord Hybrid, Honda has revamped the styling and pricing of the car for 2006, making it more distinctive-looking from 20 paces (there's a new spoiler on the trunk lid and flashier wheels) and more luxurious on the inside. Among the standard features on the 2006 model: heated leather front seats, a power moon roof, stability control, a gauge on the dashboard that shows the driver how the hybrid system is operating and a spare tire. (The 2005 model didn't have a doughnut tire.)

"Our customers told us in no uncertain terms when we went to talk to them that …a $30,000 car needed a sun roof, and needed a spare tire," says Honda spokesman Sage Marie.

The price of the 2006 Accord Hybrid is about $850 more than the 2005 model. But Mr. Marie says the car has some $1,550 worth of new equipment.

Now that it's clear that consumers are becoming more discerning when it comes to hybrids, the stage is set for a real competition over how best to use technology to reduce the amount of oil consumed by cars and trucks.

General Motors and Ford took their lumps when Toyota and Honda beat them to market with gas-electric hybrids. But Detroit's auto makers now see an opening to strike back, as consumers learn more about the cost tradeoffs of gas-electric hybrids.

In recent weeks, the two big Detroit auto makers have fired up promotions of their so-called "dual fuel" technology, which allows internal-combustion engines to run on a mix of 85% ethanol and 15% gasoline, otherwise known as E85. President Bush gave ethanol a rhetorical boost in his State of the Union speech, and the administration plans to give efforts to develop economically competitive production and distribution of ethanol fuels a modest financial boost as well. The U.S. companies like ethanol because they have a lead in producing at competitive cost the technology to allow vehicles to burn it.

Europeans, meanwhile, express growing optimism that they will soon overcome the environmental barriers to selling more diesel engines in the U.S.

Gas-electric hybrids will almost certainly grow as a share of U.S. vehicle sales, given the number of new hybrid models planned by the major car makers. But unless Washington is prepared to put teeth behind the rhetoric about swearing off Saudi oil by enacting a steep gasoline tax, the industry will need to reckon with the Calculator Conundrum. That means focusing on delivering hybrids that really do save a lot of gasoline compared to a standard vehicle of similar size, or offer more-modest gains at a nearly equivalent price.

It's hard to bet against Toyota, which is highly profitable and has an enormous war chest for research and development. But GM and its partners, DaimlerChrysler and BMW, are promising to deliver a competing, lower-cost hybrid system that can power large SUVs to 25% fuel-efficiency gains. If they succeed, they would gain an advantage in a segment where high gas prices appear to have taken a toll -- notwithstanding the economic reality that a few hundred bucks extra a year for gasoline is a financial non-event for most people able to afford a $40,000 SUV. GM also has high hopes for a low-cost "hybrid" boost system it will roll out soon in its Saturn Vue small SUV.

The struggles of the Accord Hybrid and the cooling of demand for some other hybrids suggest that the initial stage of hybrid mania is about over. Hybrids that focus on fuel economy -- notably the Prius and the Ford Escape hybrid -- are still selling briskly compared to their gas-only counterparts. Vehicles that use hybrid technology as a sort of turbocharger to crank up horsepower look less compelling. The stage is set for round two, in which companies compete to develop hybrids that not only make owners feel good about contributing less to global carbon-dioxide and pollution levels, but also make economic sense.