With Gas Prices So High, Some Hybrids Pay For Themselves Immediately
The Ford Maverick and Lexus NX will start saving you money the first time you fill up, CR’s analysis shows
As gas prices hover at record levels, car buyers looking to save money on fuel would be wise to consider a hybrid, a new Consumer Reports analysis shows. Although most hybrid vehicles cost more to buy up front than their gas-only counterparts, our analysis shows that the majority of hybrids will save you more money in the first two to three years of ownership, even if gas prices fall from current levels. For some vehicles, such as the Ford Maverick pickup truck and the Lexus NX SUV, the payback period is immediate because of the hybrid version’s lower purchase price.
Hybrid vehicles combine a gasoline engine and a battery-powered electric motor. Unlike fully electric vehicles, they do not need to be plugged in.
(Above calculations assume $5-per-gallon gas and 12,000 miles driven per year. The Ford Maverick Hybrid is offered only in front-wheel drive while the nonhybrid we tested is optioned in all-wheel drive. Even a front-wheel-drive nonhybrid XLT is $1,000 more than the hybrid.)
Not all hybrids offer instant savings. The Hyundai Sonata Hybrid sedan has a seven-year payback period, and the Ford Escape SUV and Toyota Camry hybrids will pay for themselves in four years.
If gas prices were to fall to $3 per gallon, the payback period on a Hyundai Tucson Hybrid or Toyota Highlander Hybrid would increase from two to three years. These calculations don’t consider other money-saving factors—such as the higher resale value for hybrids when compared with gas-only counterparts—that can make the equation even more favorable.
Bigger Savings on SUVs
The payback period is shortest for SUVs, and the reason for that is just simple math and physics: SUVs tend to be larger and heavier, and they get worse fuel economy to begin with, so an improvement is more meaningful. “Going from 20 mpg to 25 mpg saves a lot more fuel than going from 30 mpg to 35 mpg,” Fisher says.
Say you’re taking a 500-mile trip. A gas-only sedan that gets 30 mpg will use about 16.67 gallons of gas, while the hybrid version that gets 35 mpg will use about 14.29 gallons of gas. That’s 2.38 gallons saved. But compare a gas-only SUV that gets 20 mpg and a hybrid version that gets 25 mpg, and the hybrid will save you 5 gallons of gas.
We did not examine plug-in hybrid-electric vehicles (PHEVs), which combine a gasoline engine with a short, electric-only driving range. PHEVs may offer even more savings for drivers with short daily commutes. Fully electric vehicles can also save owners money over the course of ownership, but they might not be ideal for all drivers. Most plug-in hybrids and EVs also qualify for a federal tax incentive of up to $7,500, which standard hybrids don’t get.
More, Better Hybrids
There’s also a much wider variety of hybrids available today. In the past, hybrids tended to be purpose-built models designed for maximum efficiency, like the Prius, or luxury models with extra features that made it hard to compare a hybrid directly with the most popular trim levels of gas-only vehicles.
“Many automakers used to force consumers to buy higher trimlines if they wanted a hybrid, but that has changed,” Fisher says. “Today, you can find hybrids at many prices, and for some newer models the hybrid is the cheapest version available.”
Beyond fuel economy, some of these models do better in our tests than the gas-only vehicles they’re based on. Consider the Hyundai Santa Fe Hybrid. Our testers found that it rides better, is quieter, and shifts more smoothly than the gas-only Santa Fe. On top of all that, it’s almost 2 seconds quicker than the nonhybrid in the dash from 0 to 60 mph.
“Today’s hybrids drive quite normally,” Fisher says. “For most models, there’s very little difference in the driving experience between a nonhybrid and a hybrid, especially when compared to early hybrids.”
In addition, CR’s data show that hybrids tend to have lower repair costs than their nonhybrid counterparts. At the same time, they tend to have higher owner satisfaction scores.
Watch Out for Markups
If hybrids rise in popularity along with gas prices, expect to see dealerships marking up the sales prices of hybrid vehicles the same way they’ve done with cars, trucks, and SUVs that have been in short supply over the past two years.
One of our car buyers was quoted a 10 percent markup over the sticker price on the Kia Sorento Hybrid he tried to purchase for our auto test program—and that was after he contacted multiple local dealerships that didn’t have the vehicle in stock.
Whether such anecdotes turn into a wider trend remains to be seen, says Tyson Jominy, vice president of data and analytics at J.D. Power.
“It’s still really too soon to see anything definitive in the data, since the fuel price jump is so recent,” he tells CR. But Jominy says that early indicators point to hybrids selling faster than gas-only cars. In addition, hybrid market share appears to be increasing in line with gas prices, even though there are fewer hybrids in stock on dealer lots.