One thing that was really striking up in Cairns is how many Toyota Priuses are on the road. There are a whole lot – led by the taxis. I’d estimate that the Prius makes up about 2/3 of all of the taxis there (including one that’s gone over 500,000 km!). I just did a quick bit of research into Prius sales in Australia, and it looks like about 2% of all sales are in Cairns – about three times what you’d expect based on population. And since Prius sales have been overwhelmingly concentrated in the capital cities, that number is probably more like eight or ten times what you’d expect for an Australian city the size of Cairns.
Nancy and I were talking about this on the drive in today, and she suggested that maybe people up there are greener. That’s possible, but aside from all the Priuses on the road, there wasn’t a lot of evidence for that. I actually suspect it’s something simpler. In Brisbane and the other major cities, a Prius is still rare enough that people notice it and talk about it – and its ‘greenness’ is one of the big selling points in that situation. However, in Cairns, they’re so common that they’re unremarkable. In some respects, the Prius is just another car up there. And that actually makes it a lot easier to buy one. You’re not making a big political or environmental statement, you’re just buying a good car that’s really fuel efficient – if it’s good enough for the cabbies, it must be good enough for regular use.
If Toyota wants to get the Prius to go from being a niche vehicle to a more broadly popular one (and I’m still not convinced that they actually want to do this yet), this is the transition they need to make in peoples’ minds. They need different examples to show people. As a niche vehicle, it’s fine to have endorsements from celebrities that are known to support environmental causes. But if you want everyone driving one, go for the cabbies and turn it into just another car.
It seems to me that there’s something in the situation of which you are not aware. Adoption of innovation increases proportionally to the reduction in barriers to adoption. Those barriers can be technological, economic, or social. In the case of the Prius, my guess is that the barriers are economic and social. The hybrid system adds several thousand dollars to the car, which is the economic barrier. The social barriers can range (here in the U.S.) from anti-import sentiment (which I’ve never understood, given the globalization of auto parts supplies) to concern about looking out of place or overly “granola.”
The question to answer is how have the citizens or government of Cairns surmounted the obstacles to adoption?
Here in Colorado, the Prius is just another car and a frequent sight. The primary reason is that the U.S. government until recently provided a multi-thousand dollar tax credit; the other reason is that the state of Colorado had a tax credit that was approximately double the federal credit. Add to this the growing environmental concern driven by tourist dollars and fossil fuel impacts, and you get a trend. Perhaps something similar has occurred in Cairns.
Hi Greg. I think that’s mostly true. However, there are no tax benefits in Cairns, and no other obvious drivers. The anti-import thing in the US has always confused me – especially when people were (are!) ready to buy a Ford manufactured in Mexico rather than a Toyota manufactured in Kentucky. I always figured it would be better to support American workers instead of American business owners, but what do I know?
I’m not entirely sure I agree about barriers though. Everything that’s new has to spread, and the s-curve is pretty much universal. I agree that things like tax credits & social acceptance can get things up the s-curve faster, but they’re not the sole thing driving diffusion…
Hi Tim,
I think this is a plausible explanation for what might be occuring now…
“However, in Cairns, they’re so common that they’re unremarkable. In some respects, the Prius is just another car up there. And that actually makes it a lot easier to buy one. You’re not making a big political or environmental statement, you’re just buying a good car that’s really fuel efficient – if it’s good enough for the cabbies, it must be good enough for regular use”.
However, key to your point is resolving the question of what mechanism originally generated this popularity? And why is it not operating in other areas? One explanation might be that ‘tree changers’ are big in Cairns, and these folks are big on being green. Therefore, there is some form of city-level selection mechanism operating that leads to a higher proportion of people demanding the Prius than you would expect in non-tree changing cities. However, I guess it would be better to try for something a little more parsimonious. Here’s three attempts organised around the logic driving their creation:
1) Classic economics: The type of driving that people need to do up there provides people with much higher returns to adoption than in other cities.
2) Market imperfections and behavioural economics: Cairns has an above average proportion of people working in the public sector. The government has made a commitment to offer the Prius as a competitive salary packaging option. Lots of folks have therefore adopted it because it’s underpriced in terms of the returns they’ll get on it socially (wow it’s a Prius!) and economically (fuel). (you could actually empirically test this idea by comparing it to Prius penetration in Canberra and other high pubic sector cities)
3) Institutional theory: An enterprising bloke who owned most of the cabs decided that the Prius would be a good marketing ploy for all the tourists and found the fuel efficiency to be great, so he adopted them. This legitimated the purchase in the eyes of other consumers (“well shit, if the cabbies think they’re ok…”) and it spread from there…
In reality I suppose it might be a combination of these forces… 😛
Tim,
A more pedestrian explanation (no pun intended!) is that Cairns’s CBD is much smaller than Brisbane, thus you are much more likely to see the same cars circulating there than in Brisbane (and this is more so for Taxis.)
Since the sight of Priuses is more remarkable (to you) you are more likely to notice them when they do the rounds than other makes.
But this does not address the question of whether there are local factors in play too.
Sam – I think your three theories are all plausible – and I agree that it is probably a combination. I suspect that your institutional theory is actually closest to the truth though.
Cairns is MUCH less of a tree hugging town than I would have expected, given that so much of the work there depends on the Great Barrier Reef (although their federal MP is ALP, so maybe I’m underestimating that).
I had that exact thought myself Marco. I’ve done some research though and Prius actually is the predominate vehicle for cabs up there, and the ones that I saw that weren’t cabs were all different (different colours, etc.), so I ruled out that explanation. In other words, the 2% of Australia’s total Prius population is based on some research, not just my perceptions. 😀
No worries, at least there is no risk of anyone mis-underestimating anything! 😛