May 15th, 2007 at 1:29 am
In order for a “green car” to be more attractive fiscally than a normal car, the cost savings per month in gasoline needs to be more than the extra amount of monthly payment one incurs for the higher priced hybrid.
Trying to match apples to apples, this is a comparison of a Toyota Camry CE with a Toyota Camry Hybrid. Prices are available at toyota.com. Autos.yahoo.com reports an city mpg of 24 for the CE, and the Toyota site reports a city mpg of 40 for the hybrid. There is a big assumption here, that other than the engine the hybrid is more like the cheap CE than the more expensive models. This is a worst case scenario.
Gasoline cost per month = 30 * miles driven per day / miles per gallon * price per gallon
Fuel cost per month calculations:
| 24 miles per gallon | 40 miles per gallon | |||
|---|---|---|---|---|
| Miles Per Day | $3/gal | $4/gal | $3/gal | $4/gal |
| 20 | $75 | $100 | $45 | $60 |
| 50 | 187.5 | 250 | 112 | 150 |
| 100 | 375 | 500 | 225 | 300 |
Assuming no trade-in, $1000 down, and an interest rate of 3%, the monthly payment of a 5-year loan for the $18470 CE would be $313.91. The $26,200 hybrid would be $452.81. Difference: $138.90 a month. There are federal tax deductions and credits for the hybrid, but they will be phased out by the fourth quarter of 2007.
Looking at the table, it seems the hybrid is cost effective if one drives 100 miles a day on average at $3/gal (375-225 = $150 in gas savings). If one averages just 50 miles a day, the vehicle only starts paying out at $6/gal.
100 miles per day for 5 years = 182,500 miles. That is one tired car. 
May 15th, 2007 at 10:04 am
And Hybrid’s don’t get that kind of mileage in-town. In town, the mileage is much closer to the standard car model. I don’t have the figures in front of me, but will post if I can find the right article.
May 15th, 2007 at 10:10 am
For me, I’m sticking with my diesel pickup. It only gets 18+ on the highway, but it is paid for. I can afford a lot of fuel for the price others are paying in monthly car payments.
Buy an older vehicle that you can pay for with out a monthly payment. Taxes and insurance are cheaper, and all you have to pay for is fuel and routine maintenance.
At some point hybrids will become “older”, if not worn out, and they will become affordable for us ‘average’ citizens that can’t afford new cars in the first place.
May 15th, 2007 at 2:16 pm
Actually, my Prius gets better mileage in town than it does on the highway. We do somewhere between 48-53 in town and about 41 on the highway. There have been peak times where I’ve looked down to realize that I’ve been on battery power alone (at about 35mph) for a while, where the mpg topped out at 99.9 (as high as it registers). Admittedly the Prius does get better mileage than the Camry.
Where it really hit me was on my last 250-mile trip (500 round trip). I had to fill our Escort wagon (5-speed, 4-cyl) each way, for a $65 total gas cost. The Prius would have done it for about half that.
I agree with Lawrence that in some ways mileage shouldn’t be a consideration. Pay cash for a dependable vehicle that fits your needs and you’re money ahead. Then it really doesn’t matter too much, from a financial standpoint, how much gas you’re putting into it. It’s paid for.
May 18th, 2007 at 2:28 pm
OSC, Good point about the battery power often increasing in-town milleage.
Do you charge your battery while driving, or do you have to plug it in overnight? With the price of electricity, I wonder how much money is saved by driving on batteries charged from house power?
{ps. I’m not against reducing pollution. Just against forcing people to sacrifice their living for the sake of a few gallons of gas.}
Regarding a 500 mile trip. It would cost about $85 in diesel. at $3.00/gal. Compared to about $40 in gasoline in a Prius.
If I figure my daily fuel cost for commuting at about $8 a day for approximately 250 days per year. Calculates to about $2000 per year in fuel. If I buy a Prius I reduce my fuel costs to approx. $1000 per year, while adding a car payment ($250*12=$3000). Total $4000 per year in fuel/payments for an net loss of $2000 per year. Plus increased insurance for a newer car. Plus if I want to haul anything I have to then borrow or rent someone else’s vehicle. (Anyone every try to haul a 4′x8′ sheet of plywood in a Prius? without cutting into little pieces?)
Alternatively, and what I actually do, is car pool (ride share) with someone so we can both cut our yearly fuel in half and reduce wear-and-tear on both cars. Maybe he and I should go halves on a Prius just for commuting to work? Hmm….
May 22nd, 2007 at 8:20 pm
I have a better answer:
Buy the hybrid (or any decent car) *used*. Then you are money ahead.