Do hybrid cars actually save you money in the long run? This is a hotly contested debate in the automobile world. Several studies released by Consumer Reports and other review agencies have shown that on average, you don’t actually save money by buying a hybrid vehicle. However, most of these studies only take into account the difference between gas mileages. They don’t take into account many of the other factors that go into calculating the total cost of ownership.
A new study released by Intellichoice, a vehicle research center, shows that hybrid vehicles do indeed save you money in the long run. In addition to fuel savings, these are some of the ways that hybrid vehicles save you money.
Better Value Retention
Have you ever heard the saying that your car is worth 30% less the moment you drive it off the lot? That’s true of every new car – except the hybrid. A hybrid vehicle retains its value better than any other type of vehicle. This value retention is true in the first year, as well as five years down the line.
Federal Tax Credits
There are numerous tax credits you can take advantage of by driving a hybrid vehicle. These tax credits can range anywhere from $250 to $3,150 depending on the state, the time period and the vehicle you’re driving.
Lower Maintenance Costs
Although a hybrid costs more to purchase upfront, their maintenance costs are significantly lower than the average vehicle. According to the Intellichoice report, the cost of the average non-hybrid vehicle of a comparable nature to the Prius over a five-year period was $33,305. Conversely, the Prius incurred only $19,897 in costs.
Differences in Financing Options
One big hidden cost to buying a vehicle is financing. The percent interest you pay on purchasing your vehicle is a very, very significant part of the total cost of your purchase. While there are no ongoing special rates for the Toyota Prius, the Civic Hybrid or other hybrid vehicles, the fact is that financing deals are run several times a year specifically for hybrids by most major manufacturers. That means that if you wanted to buy a Toyota Prius and just waited until a 0.9% APR deal came around, you could save a significant amount of money.
Insurers also take the driving habits of hybrid owners into account. If you own a hybrid, your accident rates are a lot lower than other types of car owners, which in turn lowers your insurance costs. When you take all the various factors into account, not just the differences in fuel costs, hybrid vehicles really do end up saving money in the long run.