More fuel efficient cars are coming in all shapes and sizes now. Hybrid is a catch phrase that many dealers are pushing. Is it time to buy a hybrid though? The last time I did the math on the difference in cost (taking into account tax rebates for the hybrid). It didn’t make sense to spend the extra money unless gas went up to 8 dollars a gallon or I drove twice as much a year. (Or I kept it for 10-15 years.)
So, when does it make sense to buy a hybrid?
And what’s more how should you figure out. It’s funny, everybody says you save money with a hybrid, but until you sit down and do a comparison, you won’t know. i.e. it depends on your usage.
Start by tallying up your mileage for the year. Divide that by your miles per gallon to see how many gallons of fuel you bought over the year and do a rough cost estimate with the current gas prices. That’s how much you’re spending in a year on gasoline. Now compare the hybrids sticker price with a comparable car. Subtract any tax credits from the difference. Now compare this “premium” for the hybrid with your yearly fuel costs. Will it take a year to make up the difference? Three? My opinion is that if it’s four years or less, then it’s probably a worthwhile ROI. More than that and I think I’d hesitate.
You might revisit your gas price estimate and ask yourself how much you expect that to change in the next couple of years (as that will effect your return on investment.) Also, consider if your driving patterns will be changing – will you be driving more, less or about the same in coming years.
After all of this, you should be able to answer the question if it’s really time for YOU to trade in your car for a hybrid car.