2008 Cost of Hybrid Ownership Report

[Lazybones]

Burnaby, British Columbia ? The British Columbia Automobile Association (BCAA) has released the results of a study on the cost of hybrids versus comparable conventional models. Studying all thirteen hybrids available in B.C. over a five-year period, and factoring in fuel costs, the provincial Alternative Fuel Vehicle Tax Concession and the federal ecoAUTO Rebate Program, the analysis revealed that in seven of the 13 vehicle pairs analyzed, the hybrids turned out to be cheaper over five years overall.

http://www.bcaa.com/wps/portal/newsroom/news_releases?rdePathInfo=xchg/bcaa-com/hs.xsl/6605.htm

[Thorin]

What's always interesting in these is looking at their analysis data (found here: http://www.bcaa.com/downloads/2008-Cost-of-Hybrid-Ownership.pdf)

• They didn't factor in maintenance and insurance costs
  ($5k to $8k battery pack replacement after how many years?)
• They didn't factor in residual value of the vehicle after five years
  (a car's not worthless after five years and if you're doing a cost comparison you must include residual value, even if it's just an estimate)
• They didn't factor in manufacturer rebates on cars that don't sell well - they went with MSRP instead
  (for example regular Tahoes are discounted $7,500, hybrid Tahoes are discounted $6,500, as shown here: http://www.gm.ca/gm/english/corporate/offers/price-adjustment/alberta#chev)
• They used the published fuel economy ratings, even though hybrids have gotten a reputation for over-stated fuel economy ratings
• They assumed 20,000kms/year, split 50% city and 50% highway - what if I drive less km, or more on the highway?
  (to compare, federal ecoAUTO rebate program assumes 55% city/45% highway)
• And here's the biggie:
  Purchasers of hybrids get rebates from the federal and provincial (BC) governments; on all but the Toyota Highlander, you save less than the governments give you, meaning that if the government didn't give you money to buy the hybrid, it would cost more to run for five years than the car it's compared against, even at today's gas prices, even forgetting the first four points!

The extra cost of the technology is still not worth it.  If you want a cheap-to-operate car, buy the new $9,995 Hyundai Accent.

[Mr. Analog]

I was watching BBC world news the other day and I guess the SUV has abruptly stopped being the "top selling" vehicle type in the USA. After something like 7 years of domination sales took a big dip in only two months. The part I found interesting was the subsequent rise in compact and hybrid cars. The analyst on the show speculates that the resale value for SUVs is going to become abysmal in the near future (especially if fuel prices continue to "soar").

Whether or not that is mechanically true of the vehicles is a bit of a moot point, "SUV == gas guzzler" is part of the zeitgeist now. It's unfortunate for people who re-sell vehicles I guess...

Honest to god I wish I had a link to share.

[Thorin]

The thing is, people with enough money will continue to buy vehicles that consume more gas.  Just look at the V8- and V10-powered monster cars that are still being designed and built, and people just gobble them up!  Full-size SUVs have been targeted as "environmentally-unfriendly gas guzzlers", but has anyone stopped to ask how much fuel the new Audi R8 (16.9L/100km city, 10.2L/100km highway) or Mercedes-Benz SL550 AMG Roadster (17.4L/100km city, 11.5L/100km highway) use?

What bugs me the most, though, is that Priuses are still hyped as the ultimate fuel misers even though you typically get 20% to 40% worse fuel economy than the stated number.  Once you factor in real-world results, they cost more than a regular car, and there's still all kinds of unknowns about the battery packs.  There's just so much disinformation on the subject, and yeah, it seems like there's suddenly been a switch flipped in the collective consciousness based on said disinformation.

Keep in mind, too, that the SUV dominated sales in the US, where even single people with no friends hankered for a Suburban-sized Escalade EXT to drive around town.  In Canada, we're still sold on economy cars and minivans.  Hard to believe in Alberta, where trucks outsell any other vehicle type, but trucks are remarkably rare in Vancouver and Toronto and Montreal, etc.

One thing's for sure, those of us that require larger vehicles with good winter traction will continue to buy larger vehicles with good winter traction.  Large SUV drivers are unlikely to switch to "crossovers" just because of gas prices, because crossovers simply won't work for them.  Just like how construction companies will continue to use V8- and V10-powered pickup trucks and full-size vans.

[Thorin]

Another year or so of current oil prices, and I expect we'll start seeing more oil-rich countries stop trading away their oil.  Just like how Venezuela keeps its gasoline prices low by simply keeping enough gasoline within its borders rather than selling it on the open market.

[Lazybones]

They didn't factor in maintenance and insurance costs
($5k to $8k battery pack replacement after how many years?)

If looking at it for 5yrs on the Civic the batteries are covered all the way to 8 years.

Honda Limited Warranty Information

   * Bumper-to-Bumper Limited Warranty (years/miles) = 3/36,000.
   * Powertrain Limited Warranty (years/miles) = 5/60,000.
   * Corrosion Limited Warranty (years/miles) = 5/unlimited.
   * Accessory Limited Warranty - All Honda accessories are covered up to 3 years or 36,000 miles, depending on time of installation.

Additional Limited Warranty Information

   * Its IMA battery pack comes with an 8-year/80,000-mile warranty, or a 10-year/150,000-mile warranty in CA,CT, MA, ME, NY or VT.* See your dealer for details.
   * Replacement Parts Limited Warranty - Genuine Honda parts, when installed by a Honda dealer, are covered for 1 year or 12,000 miles. Parts purchased from, but not installed by a Honda dealer are covered for 1 year.

They didn't factor in residual value of the vehicle after five years
(a car's not worthless after five years and if you're doing a cost comparison you must include residual value, even if it's just an estimate)

Some say are much better at holding value
http://www.mota.net/Blog/2008/04/hybrids-are-retaining-their-value-cars.html
Others say the opposite
http://www.newsweek.com/id/138808/page/2

They didn't factor in manufacturer rebates on cars that don't sell well - they went with MSRP instead
(for example regular Tahoes are discounted $7,500, hybrid Tahoes are discounted $6,500, as shown here: http://www.gm.ca/gm/english/corporate/offers/price-adjustment/alberta#chev)

Always pays to shop around.

They used the published fuel economy ratings, even though hybrids have gotten a reputation for over-stated fuel economy ratings

They may be over stated but they are still typically better than the non hybrids which are also over stated.

They assumed 20,000kms/year, split 50% city and 50% highway - what if I drive less km, or more on the highway?
(to compare, federal ecoAUTO rebate program assumes 55% city/45% highway)

The more city driving the BETTER hybrids perform in terms of gas savings, the opposite is true for non hybrids.

And here's the biggie:
Purchasers of hybrids get rebates from the federal and provincial (BC) governments; on all but the Toyota Highlander, you save less than the governments give you, meaning that if the government didn't give you money to buy the hybrid, it would cost more to run for five years than the car it's compared against, even at today's gas prices, even forgetting the first four points![/li][/list]

Good for me bad for you in Alberta? This should be lumped with your manufacture rebate argument.

The extra cost of the technology is still not worth it.  If you want a cheap-to-operate car, buy the new $9,995 Hyundai Accent.

If a cheapo smaller car meets your needs than sure that is the best bet. However if I was looking at a civic which has decent performance and comfort, I might consider the hybrid version over the standard ones now.