Hybrid Cars * Hybrid Cars Cost Effective * Fuel Economy * Tax Credits * Auto Economy * Prius * Honda Civic

    Home     Facebook     Blog     Forums     Twitter     Shop!     Feed  

Are Hybrid Cars Cost Effective?

hybrid cars

Hybrid cars are versions of gas-powered vehicles that can cost thousands more than their gas-guzzling counterparts. Fuel economy is supposed to make up the price difference, but that can take well over ten years, depending on the car. Certain hybrids really are worth investing in. Still, quite a few models are far from cost-effective. So how do you tell if the one you want is worth the money? Factor in crucial details and start comparing.

How far do you drive each year?

For those who drive hybrids more than the typical 10-15,000 miles per year, the fuel savings will add up quickly. Something else to consider is the cost of gas where you live; the higher the price of oil, the higher the savings will be from choosing a hybrid. This means the farther you drive, the faster the savings will add up. The larger initial cost may be well worth it. Besides, proud owners of "green" machines don't have to worry nearly as much when gas prices skyrocket.

How long will you keep the car?

As mentioned before, even after subtracting generous federal tax credits, hybrids are more expensive than gas-powered cars. The amount of time it will take to make up for this can range from a few years to over a decade. Will you keep the car long enough to cover the difference? Each passing year, depreciation will also influence a car's cost-effectiveness. The problem is that hybrids haven't been around long enough for owners to know what will happen over the long-term. So far, however, they've held their value surprisingly well (ref: Yahoo! Green!.)

Are you considering costs of ownership?

Not only are hybrids costly to develop, but small cars get in the most accidents, which makes insuring them more expensive (ref: Automotive Digest). To cover higher premiums, money saved at the pump may end up getting handed over to insurance companies. Extra costs like this one are to be expected. For instance, when buying a hybrid, a higher sticker price will naturally come with more sales tax. It could also add thousands in interest if the car is financed. Higher sticker prices usually mean that everything else is going to be more expensive, too.

So what's the verdict?

Among the least cost-effective hybrids are the Lexus RX400h, Toyota Highlander, and the Saturn Aura Green Line (ref: CNNMoney.com). The Toyota Prius and Honda Civic are the only truly cost-effective hybrid models for average drivers. Alas, that will probably change once the tax incentives are taken away. It's not like there aren't exceptions; for people who drive over 30,000 miles per year, a few hybrids besides the Prius and Civic might be wise investments (ref: Yahoo! Green.) Drivers can also choose hybrids to simply reduce their carbon footprints. While it may not make them any more cost-effective than non-hybrids, it will help keep the Earth cleaner and greener, and that's something we can all benefit from.

Other resource for cost-effectiveness: http://www.intellichoice.com/carBuying101/HypeOverHybrids.