Hybrid Car Price vs. Gas Savings

I’ve written about the price of hybrid cars in the past and how significant the gas savings are. I’ve also been called out on the fact that I haven’t considered how expensive hybrid cars are to maintain, so I thought today that maybe I could go over some of these potential costs and get down to the truth of the matter: is it ultimately cheaper in the long run?

Before I get into the details, I think that making the environmental disclaimer is important. Sure, I may be beating a dead horse, but I truly believe it’s important to reiterate how becoming less dependent on oil is important for our planet’s future. So, even if you read this article and decide to keep your gas guzzler– please consider incorporating car pooling, public transportation and cycling into your weekly routine to lower your carbon footprint.

Hybrid Car Price vs. Gas Savings

Let’s breakdown the hybrid car price and compare it to its gas savings.
Standard Hybrid Prices

An examination of some of these popular hybrid cars shows that the prices of hybrids vs. gas aren’t dramatically different.

Honda Insight $18,200

Toyota Prius $23,520

Chevrolet Volt $$40,000

Sure, they may not be the cheapest car on the lot, but they’re not so much more expensive that the idea of buying one is a luxury. I think it’s safe to say that you can find both gasoline and hybrid cars for the same price as the average price of a new car in America is $28,400.

Estimated Gas Savings

The average number of miles a American driver completes per year is 15,000.

Let’s just say the average hybrid sedan gets 41 mpg and a moderately fuel efficient gas fueled sedan gets 29 mpg.

Hybrid Sedan 41mpg : 15,000/41= 365.85 gallons of gas a year.  Multiplied by national average price of gas: 365.85 x $3.59 =$1313.40

Regular Sedan 29 mpg : 15,000/29 = 517.24 gallons of gas a year. Multiplied by national average price of gas: 517.24 x $3.59 = $1856.89.

Let’s see the difference. $1856.89 – $1313.40 = $543.49

You could save an estimated $543.49 a year on gasoline.

Not too shabby. Also not as spectacular as I would have thought.
Tax Incentive Savings

If you purchase a plug-in hybrid or an electric car you may be eligible for $2,500 to $7,500 in tax credit. Definitely a perk.
Hybrid/Electric Car Maintenance

Okay, so here’s the thing that makes hybrids and electrics so expensive. Battery replacement. After around 7 years of use, you’ve got to think about replacing the battery in your car. Not so fun, especially considering can cost up to $4000 to replace! Eegads. Prices are allegedly dropping but along with installment, you’re looking for quite a hit in the future.

So, let’s compare. Are the gas savings worth it in the long run?

Average Hybrid – 15 years ownership

Price – $28,400

Money Spent on Gas – 15,000 miles x 15 years = 225,000 / 41 mpg x $3.59/gallon = $19,701.20 total on gas.

Tax Credit – $5,000

Battery Replacement – $4,000

Now, the average gas car is going to use $27838.35 in gasoline over 15 years.

This means the hybrid will save you $8137.15 over its lifetime in gas savings. This number is subject to change as the gasoline prices fluctuate throughout time. I just based it on the national average today July 10, 2011.

So, is it worth it? There are plenty of expenses along with the hybrid that might void any real savings. At the end of the day, with battery replacement and other expensive fix-ups, you might not save tons of money, so it becomes a personal choice.

What do you think of Hybrid Car Price vs. Gas Savings?