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Thread: Prius Payback
11-15-2004 06:32 PM #1
I've only visited this site a few times, and received the newsletter a few more times, but I am already impressed with the information and postings provided here. My sister was the first in our family to buy a 2004 model Prius, which she received in March of this year. (By the way, she has been averaging around 50 mpg combined, drinving in the Cleveland, OH area for 8000 miles). My brother and I each have one on order and my brother's wife bought a hybrid Civic last year--which she now likes much less after seeing my sister's Prius--which is why my brother ordered one.
I have seen several articles, in print and on the web, stating that most hybrid vehicle buyers won't get a payback on their investment. I don't believe that is true.
Regarding the simple payback of buying a hybrid, it is tempting--probably for oil company execs--to compare the cheapest Camry with the Prius, to make payback look bad. However, there are several low-end Camrys (from the Toyota website) that are base-priced higher than the Prius, so it is possible to make a case that the Prius is actually less expensive than its non-hybrid counterpart.
In my payback analysis, I am conservatively assuming a $2000 price premium for the Prius, and knowing that I drive 375 miles per week, I will pay back the hybrid "premium" in roughly 3-3.5 years, at $2.00/gal gasoline. That's a 20-25% return on my investment! Which is a lot better return than I am likely to get in any other investment. I think any analyses one reads that show you won't pay back the hybrid premium, needs to be looked at very skeptically (being an engineering researcher, that's my job). I realize some people may think $2.00/gal gasoline will be only short lived, but I would remind them that, in Fall 1998 many Wall St. pundits were predicting the end to expensive oil, and that $10/bbl oil was here to stay. Also, hybrid owners are reducing our country's dependence on foreign oil, reducing pollution, reducing (the increase in) health care costs, and reducing global warming potential. These savings are difficult to quantify (the Union of Concerned Scientists and other groups have tried) but they are nevertheless real savings.
Can't wait to start taking data on my new Prius...which may not get here until Spring.... :-(