From my perspective, this is a regulatory issue.
Auto-manufacturers have been pushing products and platforms that streamline, simplify, and reduce cost. That means if their premier work truck, consumer truck, and SUV all share the same underlying platform it's a win. This doesn't incentivize the development of multiple platforms that are right fit but rather marketing manipulation to make the consumer think something is the right fit.
I investigated myself plugin hybrid vs full electric, and full electric won for the simple fact that a plugin needs to be charged every day I will drive somewhere. For the electric, I can recharge it once a week or twice a month and it will cover my needs. I don't have an in-house charger so this is a massive difference.
A light city car like a Nissan Leaf does pretty well with just 40kwh. The original one shipped with just 20kwh and that was a relatively heavy vehicle. Imagine the same vehicle with twice the energy density. It would have a lot more range. A few kwh go a long way on light vehicles. Electrical motor cycles have somewhere in the range of only 4-8kwh. A lot of electrical bicycles have less than 1 kwh. 10kwh is plenty for a light vehicle.
Anyway, hybrids have all the downsides of owning an ICE car (lots of moving parts, pollution, expensive fuel, maintenance cost, etc.) with only some of the upsides of owning an EV (torque, fuel economy, etc.). Basically, in terms of cost and complexity, they don't make a lot of sense. The cheaper batteries get, the less sense they make. Right now EVs are just really expensive which means not everybody can afford one. However, cheaper, smaller EVs are perfectly feasible and a lot cheaper to make. Once the high end market saturates, smaller, lighter and cheaper EVs are the next obvious growth market. From next to nothing to many millions in volume is going to happen relatively quickly. In such a market, hybrids don't really stand a chance.
Those hundreds of millions of vehicles will be replaced over the course of 2-3 decades. Annual production volume of cars will be mostly EVs by mid next decade; in about 15 years. From then on, another 15 years or so later, most ICE vehicles will have been decommissioned. The value proposition at 2022 cost levels is already pretty great for EVs (with incentives and if you can afford them). Another 3 decades of technical improvements, economies of scale, etc. is going to only improve the economics.