The reason is a combination of markedly higher CO2-equivalent emissions for manufacturing (two motors instead of one + big battery), increased weight for the same reason which causes an increase in fuel consumption + elevated tire/brakes degradation + decommissioning of the car causes more emissions. And this doesn't include the other negative externalities such as the ecological impact of the additional metal and rare earth extraction.
Hybrid cars only make sense from a CO2 perspective if you charge them and drive exclusively on electricity inside cities, with only an occasional fuel refill before long distance trips.
No, good hybrid drivetrains charge the battery during normal driving not just breaking. It saves gas by avoiding the least efficient RPM ranges of the engine.
~80%(battery & conversion losses) of 35% fuel efficiency easily beats 100% of 10% fuel efficiency. Using a 200HP engine to creep around a flat parking lot or run the AC while waiting etc is simply inherently inefficient so they turn the engine off. As a bonus you get that quick EV acceleration without an oversized engine that’s rarely operating efficiently.
As to emissions from car manufacturing, don’t ignore emissions from gasoline manufacturing. People get these comparisons wildly wrong by only looking at tailpipe emissions and ignoring upstream extraction, refining, and transportation emissions over the 25+ lifetime of an average car.
You might be simplifying a bit too much here. The most successful hybrid powertrains are built from the ground up as hybrids and the "hybridized" parts actually replace ICE parts that aren't needed anymore. For example, the HSD system in a Toyota hybrid replaces the clutch, gearbox, starter and alternator, and the result is much more robust.
Also the brakes on a hybrid usually degrade slower, because of recuperation.
For many people the local fiscal perspective outweighs the CO2 perspective. Hybrids are often financially speaking more interesting than thermal due to tax incentives.
In Denmark there has been a trial in Copenhagen, where fossil fueled cars AND hybrids were not allowed on a particular road, only EVs were allowed.
https://ti-insight.com/briefs/have-internal-combustion-engin...
It's just that we don't see it in the geopolitical west, as it's all happening in China, which is currently by far the single largest passenger vehicle market in the world.
Personally I drive a hybrid because that was the most electrified car I could afford back in 2017.