Just One Out of 16 Hybrids Pays Back In Gas Savings

thecarchik writes with this snippet from GreenCarReports: "One of the criticisms of hybrid cars has historically been that there's no payback, especially given the cheap gasoline prices in the US. The extra money you spend on a hybrid isn't returned in gas savings, say critics. Well, that may be true, especially when regular gasoline is averaging $2.77 a gallon this week. But as we often point out, most people don't buy hybrids for payback — they buy them to make a statement about wanting to drive green. Nevertheless, a Canadian study has now looked at the question of hybrid payback in a country whose gasoline is more expensive than ours (roughly $3.70 per gallon this week), with surprising results. The British Columbia Automobile Association projected the fuel costs of 16 hybrids over five years against their purchase price and financing fees. In a study released in late July, only a single one of the 16 hybrids cost less to buy and run than its gasoline counterpart." The one car that would save you money, according the study, is the Mercedes S400 Hybrid sedan — and it will only cost you $105,000.

Comments

I didn't buy one for the payback

[Lank]

Look, is it so hard to believe that someone would buy a hybrid to make a statement not to others, but to the car manufacturers making these products? I own a Honda Civic hybrid. It's not much to look at and it certainly doesn't turn heads. On the other hand, I bought it new from a Honda dealer in California when they were trying to push a lot more expensive cars on me. Why? Because I want Honda to know that I'd rather be green than cool or hip or whatever. I want Honda to know that it's important to ME so in the future they'll make cars better-suited to ME.

From one of the linked articles, "Translation: The kinds of people who buy Toyota Prius hybrids in the U.S. may indulge themselves in private, where no one else will see them, but want to be seen in public with less luxurious, greener products to bolster their reputation."

I call bullshit. I didn't do it to bolster my reputation. I put my money where my mouth is and instead of getting on a soapbox and telling everyone to go out and buy a hybrid, I actually bought one.

I don't care that I probably spent more than I'll recoup from the fuel-efficiency. For me, it wasn't about that.

Other conclusions

[JustinOpinion]

The actual numbers are quite interesting. The study seems to be doing a decent job of adjusting for other aspects of car quality and features. To do this, they directly compare hybrid and non-hybrid versions of various cars, or very similar cars by the same manufacturer when this is not possible.

What's interesting, to me at least, is how small the "hybrid loss" actually is for many of the popular models. The extra cost to buy and operate a Toyota Prius, over the Toyota Matrix XR, is apparently $1,718 over 5 years, or $343/year. This isn't that much to a person who cares about the environment. Consider, for instance, that this will apparently reduct CO2 emissions by 1242 kg/year. This means that it "costs" the environmentally-conscious consumer about 28 cents per kg of CO2 reduced. Doesn't sound too bad.

Also worth noting is that the vehicle costs were apparently based on MSRP. Thus any incentive program (e.g. government rebates) only have to be on the order of a few thousand dollars to make the hybrid cheaper overall. I would, personally, prefer it if the hybrid technology were cheaper no matter what (so that there was no excuse not to buy one), but the fact that the extra cost is so small makes it fairly reasonable to subsidize it in the name of environmental protection. (Or, conversely, taxing more-polluting vehicles or energy sources for the externality of environmental damage they cause.)

Again, I think it's well-known that it's generally cheaper to do environmental damage, and more costly to protect the environment. But I see these numbers as being very encouraging: the technology is now at a point where the extra cost of hybrid technology can be made quite small. (For instance it's only $290 extra over 5-years to own and operate the Honda Civic Hybrid vs. the Honda Civic EX. That shows how close we are to hybrid vehicles being cost competitive with conventional vehicles, even without government rebates.)

Re:Only true if you ignore the externalities

[God'sDuck]

...there are benefits gained by riding on even a semi-regular basis (ie, fitness).

Serious benefits. For all the biker-putty on the roads, the mortality stats I've seen show that even casual bikers have longer life expectancies, since the odds of getting roadkilled are so much lower than the odds of being killed by heart disease.

Re:Only true if you ignore the externalities

[vlm]

The hybrids only cost more if you ignore the externalities.

I'm used to the modern digital world, where everything is available for free and you only pay for something if you want to reward the folks whom made it.

My buying choice was to either:

1) Send $3000 to the Japanese, whom will spend the profit on formulaic movies about women and tentacles

-or-

2) Send $1000 to the Saudis, whom will bankroll their citizens into flying aircraft into our tall buildings.

I'm much happier sending a little more to the Japanese than a little less to the Saudis.

Hybirds are half-assed.

[fyngyrz]

I'm not in the least interested in buying a hybrid. I want an all-electric car. I want a normal-size car that can do 80 mph uphill, and has at least 300 miles of range at typical highway speeds. Get the price under 50g, and I'll buy it. With any luck it'd become a family heirloom. The only dealings I want with petroleum are for lubrication and manufacture of the plastic parts.

I'd love to buy a Tesla, but it's just too small, and let's face it, a wee bit on the expensive side.

Too bad EEStor turned out to be a bust... ultracapacitors could solve this whole battery mess pretty easily if they just had adequate energy capacities. Everyone else is in the "discovery" phase, which usually translates to "impractical." Not that manipulating a (very) high voltage energy source for use in low voltage, high current motors is all that easy anyway. That whole (E = CVV/2) thing is a cast-iron bitch on a number of fronts.

Oh, well.

Re:UK gasoline (petrol) currently approx $6.60

[Monkey_Genius]

The reason you pay such high fuel prices in the U.K. is because your government is gouging the bloody hell out of its citizens with taxes. The U.S. has historically had significantly lower taxes on fuel than the rest of the free world. That being said, crude oil and wholesale gasoline prices in the U.S. are inching their way back up despite record high inventory levels and reduced demand due to the prolonged recession. Those of you who are paying less than $3.00 USD per gallon here in the U.S. should consider yourselves fortunate.
The pundits in the financial press attribute much of the recent run-up in prices to the falling value of the U.S. dollar against foreign currencies such as the Euro. While this may account for some of the upward price pressure, much of the gains are due to hedging of currency risk by large firms such as Morgan Stanley -the same bastards that were responsible for bidding the price of crude to record highs in the summer of 2008 while that squint Bush was telling the world it was the Chinese and their demand that was responsible for the high prices.

Re:That's how the market is supposed to work.

[Rei]

Let's look at their numbers for the Prius comparison. Competitor: Toyota Matrix XR

Matrix cost listed: $21,800 CAD
Prius cost listed: $27,500 CAD
Matrix total 5-year cost listed: $38,606 CAD
Prius total 5-year cost listed: $40,324 CAD

Assumptions: Total cost includes purchase price, financing, and fuel costs at $1.17/l ($4.43/gal CAD), less rebates. Does not include maintenance or insurance costs. Annual driving distance is 20,000 km (12,427 mi).

Stats: I couldn't find a 2010 "Matrix XR". There's a "Matrix XRS". Heck, let's just assume that they mean the most efficient 2010 Matrix, which is a manual base model that gets 26/32mpg. The 2010 Prius gets 51/48mpg.

Fuel consumption calculations: Given these numbers, the Matrix should consume 429 gallons per year at $1,898 for five years for a total of $9,492. The Prius should consume 251 gallons per year at $1,112/yr for five years for a total of $5,561. The difference, then, is $3,931 CAD. I don't know what "rebates" or "financing" costs they're assuming, but their combination of rebates and financing seems to be approximately a net zero, so the rebate value must be low and the financing costs high.

To quote Billy Mays, however: "But wait, there's more!"

Unlike in this study, a vehicle doesn't just vanish into thin air after five years. The average age of a vehicle on the road in the US today is over 9.5 years and rising. Hence, the projected lifespan until the vehicle hits the scrapheap is about 20 years. So the total fuel difference is actually $15,724 CAD. Some last longer, some shorter. And even if your argument is, "well, I'll just sell my car after five years" -- that leaves two options:

1) The low cost of gas the Prius provides will be reflected in the resale price; OR
2) The buyer of a new Prius may get a bum deal, but the buyer of a used Prius gets a correspondingly *excellent* deal.