The Financial Advantages of a Hybrid Auto

A hybrid vehicle uses both an internal combustion engine and an electric motor. In the United States, hybrids became more popular in the United States upon the introduction of the second generation of the Toyota Prius. There were more than 2.5 million hybrid autos in the country as of October, 2012. It is now not at all uncommon to see hybrid cars, with motoring becoming downright jazzy as a result.

Hybrids cost more than regular autos – the hybrid premium – because the drive train that sends power from the engine to the wheels is more complicated and the battery is large and of high quality. The cost of drive trains will fall as technology progresses, however this will probably take more than 20 years.

The batteries of hybrids are covered by warranty for eight years or 100,000 miles. If a battery dies after a warranty has expired, the cost of replacement has fallen from $8,000 to $2,000.

Because they use less gas, hybrids are best-suited to high mileage drivers. As much as 90 percent less hydrocarbons, nitrogen oxide, and carbon monoxide is emitted. Some models use less gas than others, so it would be wise to check the ratings supplied by the EPA prior to making a purchase. The rising cost of gas makes this issue critical.

Hybrids’ regenerative braking systems produce less heat, so brake pads last longer. A spokesman for Toyota said that some Prius-driving customers have used brake pads for more than 85,000 miles. The gas engine shuts down when a hybrid is idling or traveling at a low speed, so engines experience less wear-and-tear. Oil changes are less frequent with smaller hybrids.

Research by insurance companies found that drivers of hybrids are less likely to be involved in accidents. Some insurers, such as Farmer Insurance and Travelers Insurance, have lower premiums, although some charge more. If the cost were higher, a hybrid owner should find another insurer.

Sometimes, the parking of hybrids is free. Hybrids receive a discount for the London Congestion Charge, leading to annual savings of as much as $3,200, a trend that could be adopted in the United States.

Hybrids purchased from 2006 to 2010 could receive a federal income tax credit of as much as $3,400. Credit amounts are phased out once a manufacturer has sold more than 60,000 vehicles, as Toyota did. Other incentives vary by state. Some states permit drivers of hybrids to use the carpool lane.

Although hybrid autos cost more than a regular car, a recent study found that a surprising number are cost-effective over time. The average 2012 hybrid vehicle costs $5,243 more than the gasoline-powered equivalent, but realizes $3,583 of savings on gas. Research by the automotive research company, Vincentric, of Bingham Farms, Mich., uncovered the fact that 11 of the 25 hybrids studied would cost less overall than a regular vehicle due to fuel consumption, taxes, fees, repairs, maintenance, insurance, financing, and depreciation.