Thursday, June 12, 2008

Are hybrid cars worth their premiums?

The Journal, using data from, analyzed whether the premium price on a hybrid was worth it based on gasoline savings (free WSJ Digg link). The answer is yes, as long as you own the car long enough.

It's the Toyota Prius -- but only if the buyer keeps the car for longer than three years, according to, a Web site with resources for car buyers. In the Prius vs. Camry example, it takes three years for the hybrid's fuel savings to pay back the premium paid to buy the Prius instead of a comparable gas-powered car.
The analysis used $4.02 for the price of a gallon of gas, and included the $3,000 tax credit for buying a hybrid. Not all hybrids will pay for themselves. The analysis of the Lexus LS600H showed it would take almost 100 years to pay it back, assuming the car is driven 15,000 miles a year. I think we'll all be 'driving' these by then.