Will A Hybrid Car Really Pay Off?

It's true that hybrids cost more than regular vehicles. This prompts many to wonder if the extra cost for these high efficiency cars is worth it, and in fact if the difference can be offset over time by the cash saved from buying less fuel. While plenty of generalizations have been made on this in recent years, the concept of payback for a hybrid's incremental cost involves many variables and can only be answered on a case-by-case basis. Green Car's research shows that a realistic answer is not so simple and boiling this down into a simple chart is misleading ... so we're not going to do that. Instead, we're going to do this the right way and help you come up with a valid payback factor for the hybrid you may be considering.

You need to know that crunching the numbers involves some elements that are moving targets. For example, higher gasoline prices work to shorten the number of miles needed for payback. Changing government incentives mean that calculations made today may be different than the realities of calculations made a few months down the road. And let's not forget that the retail price of hybrids also appears to be in play as some dealers tack thousands of dollars onto a hybrid's suggested retail price because of high demand.

Still, the basic equation for determining a hybrid's breakeven point is straightforward. It begins by identifying the combined city/highway mpg number for a hybrid and that of its closest conventional counterpart. These mpg figures can be found online at www.fueleconomy.gov. Once armed with these numbers you can figure each vehicle's operating cost per mile based on current fuel prices.

To do so, simply divide the price of fuel (such as $4.00 per gallon) by a vehicle's combined mpg. As an illustration, a Honda Civic Hybrid would pencil out as follows, assuming the above gas cost: $4.00