Expense of Hybrid Cars


Q: How much do I need to drive to make the extra expense of a fuel-efficient car worth it?

A: If you’re talking about a new hybrid vehicle, the answer is quite a bit. Hybrid cars haven’t quite reached the level of popularity to see huge economies of scale benefits yet. This means they don’t make enough of them to make them cheap. Perhaps they will become less expensive in future years.

For now, however, hybrid cars are still selling for anywhere from $2,000 to $10,000 more than comparable conventional models from the same manufacturer.

That’s a lot of gas you’re going to have to save to pay for the difference!

Example: The Lexus RX hybrid will cost you $6,400 more than the gasoline version – and net you 26 mpg, according to Consumer Reports, compared to 21 mpg for the cheaper gas version.

Doing the Math

So how do you figure the savings? The short answer: Divide the $6,400 difference in purchase price by the price of gas. Assuming gas prices average $3.40 per gallon, you will have to save 1,882 gallons in gasoline before you reach the break-even point. This is somewhat more if you financed the purchase and have to pay interest on the price difference.

How Long will it Take to Break Even?

How many miles do you drive each year? Divide the answer by the number of gallons you have to save to pay for the price difference, and that’s how long it will take for the hybrid to pay for itself.

In this example, if you drive 12,000 miles per year, it will take 6.37 years to make up the difference in price. The more you drive, the faster the hybrid will pay for itself.


A word of warning: Eventually you’ll have to replace those hybrid batteries! The cost ranges from $1,000 to $6,000, according to auto.howstuffworks.com. That will add another few years to your break even analysis. Be sure to look at all the factors involved in owning a hybrid.

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