This is an interesting move by Lincoln. Their 2010 Licoln MKZ sedan hybrid will be the same price as their gas powered version.
The Lexus HS 250h, the MKZ's closest competitor, costs about $2,500 more than the Lexus IS, a similar, small, gas-powered sedan. Ford charges $8,840 more for the hybrid version of its Ford Escape SUV.
Lincoln can also borrow the hybrid system from the Ford Fusion, its corporate twin, and save on development costs.
"Conventional wisdom is that the hybrid should be priced higher, but there's not really anything to say that a hybrid has to command a higher price," Merkle said.
Besides, Ford had to keep the price down, said Jessica Caldwell, an analyst for Edmunds.com. If it had sold for more than $40,000, it would have faced tougher competition from luxury cars like the Mercedes E-Class or the Audi A6, she said.
"It's going to take moves like this one to break into the luxury market," she said