Hybrid cars don't save you money. Do the math!
Don’t lie to me, you hybrid lover.
If you buy a hybrid car, say you’re doing it for the environment. Say you’re doing it to be cool like some tree-hugging celebrities you read about in US Weekly. Hell, say it because you can get it in a cool color (I actually heard this “reason” recently). But don’t say you’re doing it for your pocketbook. Don’t lie to me. More important, don’t lie to yourself.
Here, I’ll help you tell the truth. (Yes, there are numbers involved. That’s why Ramit asked me to fill in for him on this one. ;-)
I know the Toyota Prius is THE hybrid car, but for the sake of making a more direct comparison of regular and hybrid cars, I’ll use the Honda Civic Sedan and the Honda Civic Hybrid Sedan.
| Civic Sedan | Civic Hybrid Sedan |
|---|---|
| 32/37 mpg (city/hwy) | 48/47 mpg |
Split the difference on those mileage figures, and we’ll use the following numbers for our calculations…
| Civic Sedan | Civic Hybrid Sedan |
|---|---|
| 34.5 mpg | 47.5 mpg |
“They” say you drive 15,000 miles every year. To drive that far, you’d have to buy
| Civic Sedan | Civic Hybrid Sedan |
|---|---|
| 434.8 gallons of gas(15,000miles / 34.5mpg) | 315.8 gallons of gas 15,000miles / 47.5mpg) |
What does that cost you?
| Civic Sedan | Civic Hybrid Sedan |
|---|---|
| $869.57 (434.8gal x $2/gal) | $631.58 (315.8gal x $2/gal) |
Hybrid owners save $237.99 on gas every year
($869.57 – $631.58)
Wow! Saving $237.99 per year is awesome, I guess. That is, unless you think about how much more you paid for the hybrid car to save money on gas.
What do these cars cost?
| Civic Sedan | Civic Hybrid Sedan |
|---|---|
| $17,960 (highest trim level, automatic transmission) | $20,900 (continuously variable transmission) |
The Civic Hybrid Sedan costs an additional $2,940
($20,900 – $17,960)
So how many years of “saving on gas” does it take to actually start “saving money.”
$2,940 (how much more you paid for a hybrid car)---(divided by)---
$237.99/year (how much you save on gas each year)
= 12.35346 years
12.35346 years. That’s a long time. Just reading that number takes a long time.
Your situation can get a little better -- if you manage to get the $2,000 federal Clean-Fuel Vehicle Deduction, your break-even point goes down to just under 4 years. (Then again, all these numbers are based on you buying a top-of-the-line Civic sedan or hybrid sedan. If you didn't need such a nice car, you wouldn't have to spend near this much money.)
Now go buy a hybrid car at your own risk. Just don’t lie about why you’re doing it.
From Ramit: I rarely recommend other sites on here, but Ian's blog is a rare gem. If you're a college student or recent college grad and you've ever wondered what to do with your life, he's the guy to read. Ian graduated from MIT in 2004 and has managed to find his dream job--and, even more impressively, to write about it in a meaningful way. Check out his blog at http://www.ianybarra.com/blog
