This weekend, I heard a CNN expert say that switching to a hybrid won’t really save many people much money, once you factor in the cost of the new vehicle and the lower trade-in for the older vehicle. So how much money do hybrids really save?
Factors in Favor of Hybrids
There are three main factors in favor of buying a hybrid:
- Lower cost for fuel
- Less pollution
- Ability to gloat over friends with gas guzzlers.
If you buy a hybrid, you should see an immediate savings at the fuel pump. I used the fuel savings calculator to compare my current Toyota with the 2007 Prius, and it would save me $674 a year, after factoring a $720 cost for the car and $4.49 a gallon for gas. It doesn’t say, but I assume that’s the cost without car payments. Given that Priuses are going for around $24,000 in my area, buying one wouldn’t really save me much money because I’d have to finance $21,000 of that.
That said, I need to replace my car soon anyway. It’s already 11 years old, so I’m in the market. If I were to buy the same model I have now, it would cost me around $18,000. In that case I might as well spend the extra $6,000 to buy a car that gets better mileage and makes me feel like I’m doing my part to reduce pollution.
Factors Against Hybrids
There are also two main factors against hybrid cars and trucks:
- Higher purchase cost
- Potential need to replace the battery before you’re done with the car
- Waiting period.
Hybrids usually cost $2-3,000 more than their gas counterpart. The Prius and Insight don’t really have a comparison point, so I’ll compare the Camrys. According to Edmunds, the Camry Hybrid costs $4,000 more than a comparable gas model. Increased demand is pushing the prices on the hybrids even higher than that. In my area, a new Camry Hybrid costs $27,000.
Hybrid cars are also relatively new. While most experts say that the batteries should last 150,000 miles at least, there is the possibility that you’ll need to replace them and the cost for replacement isn’t yet known. However, I think you’d probably spend as much replacing the transmission or other drive train parts of a non-hybrid if you put that many miles on it.
Finally, some hybrid cars are in such demand that you may have to wait up to six months to get one. If you’re in the market for a new car, you probably don’t want to wait that long.
How to Choose a Hybrid
If you’re considering a hybrid, like I am, compare the costs and comparables of similar vehicles. Some hybrid cars don’t get much better mileage than their gas-only counterparts, in which case the higher cost of the hybrid would obliterate your savings. If I were to replace my Toyota with a Mercury Mariner Hybrid, I’d save a whopping $92 a year.
Look for a hybrid that is small and gets excellent gas mileage. I don’t like SUVs anyway, so I would opt for a Prius, Camry, or Civic, all of which have top-notch mileage and have comfortable seating room. When it comes to American cars, I’ve seen several hybrid sedans that get worse mileage than comparable gas-only Japanese cars.
When Not to Switch
If your car gets decent mileage and is only five years old, then switching probably wouldn’t save you much money. Due to gas-price panic, resale values for gas-only cars have fallen significantly. The higher cost of purchasing a new car when your old car is in good condition would probably cancel any savings in fuel cost. The CNN expert also pointed out that SUV owners are getting very little trade-in value. His advice was to wait a few months until the gas price panic levels off.
I’m still deciding whether or not to get a hybrid. Since my car is already 11 years old, most sedans will do better on gas mileage. I’ll have to run the numbers once it’s time to make the purchase, and consider the fact that I will own this car for the next ten years. Which car do I want to be driving in 2018? That’s the question of the month.
