Is A Hybrid Worth It?

Wednesday, I read an article about if a hybrid car was a good investment or not. While the article touched on a variety of political topics, it never did a cost comparison on the hybrid, which made me angry.

So, Wednesday night I decided I would do a cost comparison to see if a hybrid car was indeed a good investment, based on the amount of money you would save on gas. Obviously, there are other reasons to buy a hybrid, but I was interested in looking at it from a purely financial angle.

My findings? A hybrid car pays off if you plan to own the car for a long time, i.e. 163,285 miles worth of driving.

My Calculations

In my calculations, I used the gold standard of hybrids, the Toyota Prius, and compared it to the standard Toyota Corolla. The 2011 Prius’ starting price is $23,520, and gets 50 miles to the gallon, according to Toyota’s website. The 2011 Toyota Corolla’s starting price is $15,900, and gets 30 miles to the gallon, according to the website.

So, the cost differential between the two is $7,620. The question is, how many miles do you need to drive to make up $7,620?

To figure that out, I used a figure of $3.50 for a gallon of gas. That means it costs 7 cents per mile to operate a Prius (3.50 divided by 50). Meanwhile, a Corolla costs 11.667 cents per mile to operate (3.50 divided by 30), or 4.667 cents more.

So, to make up $7,620, I divided $7,620 by 0.04667. The answer? It would take 163,285 miles to make up the difference. 

How many people keep a car for 163,285 miles, without buying a new one and restarting the entire process? Probably very few. So financially, at least in this test case, a hybrid is not a good investment.

Again, there are other reasons to buy a hybrid, as it does reduce carbon omissions. Over those 163,285 miles, the Prius used 2,175 gallons of gas less than the Corolla.