Lately, gasoline prices have been headed in a favorable direction: Down.
But over the last several years -- especially in states like California and New York -- we've seen gas prices walk a line that many U.S. drivers have found angering and nearly unacceptable.
In order to counter the effects of higher gasoline prices, automakers have introduced hybrid technology, which allows an electrically powered engine to fuel drivers' commute during certain driving conditions.
This of course boosts a vehicle's fuel efficiency, since it requires less gasoline during the commute.
But is it worth it? Do drivers of hybrid vehicles really benefit from this added technology?
A closer look at the 'break-even' point for hybrid cars
Of course, automakers don't add this mileage-boosting technology for free. Consumers generally have to pay up to get their hybrids.
The folks at MojoMotors.com, a website designed to track vehicles and price drops at car dealerships, shed some light on how far customers have to drive in order to recoup the premium paid for the hybrid option rather than the standard model.
The above chart shows how many miles a hybrid vehicle must drive, in order for the improved gas mileage to offset with the added cost of the hybrid option.
The calculations were done on the premise that gas costs $3.50 per gallon, which is slightly above the current average price in the U.S., according to Gasbuddy.com. Of course, not every hybrid car buyer is in it for the cash they'll save -- although it certainly helps -- but also for the positive environmental effects too.
Aside from seeing which hybrid vehicle provides the most bang for the buck (Ford's (NYSE:F) Lincoln MKZ) and which one will take the longest to recoup one's investment, (Toyota's (NYSE:TM) Highlander), the chart also shows how many miles per gallon the hybrid trim adds and how much that hybrid option will cost.
What do we make of all this?
This news may be semi-disappointing for hybrid owners and perhaps good news for those who are considering a hybrid.
Seven of the eleven hybrids listed above require customers to drive over 100,000 miles just to recover the added cost of their hybrid trim, while three of them require customers to drive over 150,000 miles. Talk about a long-term investment, especially considering the average U.S. driver only covers ~13,500 miles per year, according to the U.S. Department of Transportation Federal Highway Administration.
Doing some quick back-of-the-envelop math for these cars, it will take roughly 7.5 years just for hybrid car drivers to break-even when purchasing a hybrid that takes 100,000 miles to offset the added cost. Of course, this is assuming these drivers fit the U.S. norm of only driving 13,500 miles per year.
Some cars require less driving though. The Toyota Avalon needs customers to drive roughly 45,000 miles before breaking even on their hybrid investment. That's not too bad.
The Lincoln MKZ is the best, allowing customers to start saving money the second the car roles off the lot.
That's because the MKZ's hybrid option doesn't cost the customer anything, while adding 14 miles per gallon in fuel efficiency.
Honda Motor Company's (NYSE:HMC) Civic and Accord hybrid models added the most fuel efficiency, with an extra 17 miles per gallon. However, customers would have to drive over 130,000 and 150,000 miles, respectively, to recoup the added cost of the hybrid trim.
The bottom line
Consumers who have a long commute, live in areas with particularly high gas prices, or tend to stick with their vehicle for many years can find value in hybrid cars. However other may find more value in a standard engine.
Of course, the payback period for a hybrid is sensitive to fluctuations in gas prices.
For those hybrid car seeking consumers or those who fall somewhere in the middle, focus on getting the most bang for your buck when it comes to hybrid engine options.
Bret Kenwell owns shares of Ford. The Motley Fool recommends Ford. The Motley Fool owns shares of Ford. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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