Although the Volt and Leaf have stratospheric sticker prices, both have pretty low ownership costs.
By Jessica L. Anderson, Associate Editor, Kiplinger’s Personal Finance
Sales of hybrid and electric cars jumped nearly 40% in the first quarter of the year. The primary reason: soaring gas prices. More than one-third of consumers now say fuel economy is the most important factor in their next vehicle purchase, according to a recent study by Maritz Research, a market-research firm.
Setting aside their environmental cred, are hybrids, diesels and electric vehicles actually wallet-friendly? Prices on hybrids run about $3,300 higher on average than stickers on their gas-engine siblings. The diesel difference is about $2,800 more. And the two EVs on the market — the Chevrolet Volt and Nissan Leaf — are each more than $18,000 pricier than their closest gas-engine match. But the long-term ownership costs are the real measure of whether buying green is worth it.
Using five-year ownership costs from Vincentric, an automotive data firm, we compared 2011 hybrid, diesel and electric vehicles with their closest gasoline-engine counterparts. In most cases, that’s the same model with a different powertrain; when a hybrid (like the Prius) had no counterpart, we chose the closest match from the carmaker’s lineup.
The numbers assume you drive 15,000 miles a year and that regular gasoline costs $3.64 a gallon, premium is $3.91, and diesel is $3.97 — the average prices nationwide in early summer — with a 3.5% annual increase for each fuel. In addition to fuel costs, depreciation, maintenance and repairs, the math also includes finance costs for a five-year loan after a 15% down payment, insurance and
The Volt and Leaf are both eligible for the $7,500 tax credit for electric vehicles, and that, too, is factored in.
Pump prices have a lot to do with making green cars a good. Two years ago, when gas prices were hovering close to $2 a gallon, few hybrids and diesels earned back their premium price with savings at the pump. But with gas prices now closer to $4, more buyers will save green by buying green.
Perhaps the biggest surprise is that although the Volt and Leaf have stratospheric sticker prices — nearly double those of the gas-engine Chevrolet Cruze LTZ and Nissan Versa S hatchback — both have pretty low five-year ownership costs. The Volt’s costs come within $1,600 of the Cruze’s and the Leaf is only $800 more than the Versa over five years. (Run your own comparisons of these models and many more.)