Most Hybrids Not The Solution to High Gas Prices: NADA Study

Study Finds Few Hybrid Cars Are Good Investment, Only For Some Drivers

COSTA MESA, CA - July 9, 2008: With high gas prices, hybrid cars are a more affordable option than ever in terms of gas mileage, but only a handful of hybrid cars make solid financial sense, and only for some consumers, according to a new study by NADAguides.com, a vehicle pricing and information website.

Using current gas prices for ten major metropolitan areas, the company studied the number of miles needed to recoup the extra cost of buying a hybrid car over its gasoline-only counterpart. "We recognize that every driver's situation is different and that some people will achieve a return on the extra investment of a hybrid car much faster than others," said Tara Baukus Mello, senior writer and lead market analyst for NADAguides.com.

The study showed, for example, that a driver in Los Angeles, the city with the highest gas prices in the study, will break even about 18 percent faster than a driver in Houston, the city with the lowest gas prices, assuming both are driving the same miles.

"Drivers near major cities often have a wide range of commute distances, which means that the break-even point can be dramatically different from one person to the next," cautioned Baukus Mello. "For example, if a Houston-area commuter travels 12 miles one way to work, driving 10,000 total miles annually, while a Los Angeles-area commuter travels 25 miles one way, driving 15,000 total miles annually, the Los Angeles commuter recoups his investment almost 80 percent faster."

Still, the study found that, even at today's high gas prices, only a handful of hybrid cars make financial sense for a consumer who buys a new car every five years or less and drives an average number of miles per year. Even at Los Angeles-area gas prices, there are only five hybrid cars that would allow consumers to recoup their additional investment before they sold the car, assuming they drive an average of 15,000 miles per year. In order of shortest time to break even, they are:

1. Toyota Camry Hybrid
2. Chevrolet Malibu Hybrid
3. Nissan Altima Hybrid
4. Toyota Prius
5. Honda Civic Hybrid

"Consumers who are thinking of purchasing a hybrid car solely to save money on gas should calculate the number of miles they drive per year and their typical per gallon gas price to make an educated decision," advises Baukus Mello. She also recommended consumers use NADAguides.com's Cost of Ownership tool to obtain estimates of other costs, such as car maintenance and car insurance.

Following is a chart of the top five hybrid cars with the greatest return on investment and the number of miles to break even in 10 major metropolitan areas at current gas prices.

Miles to Break-Even in Hybrid Car vs. Gasoline Counterpart at Current Gas Prices

  Major         Toyota       Chevrolet    Nissan     Toyota      Honda Civic
  Metropolitan  Camry        Malibu       Altima     Prius       Hybrid vs.
  Area (Per     Hybrid vs.   Hybrid       Hybrid     4dr Hatch   Honda Civic
  Gallon Gas    Toyota       vs.          vs.        vs. Toyota  LX
  Price)        Camry XLE    Chevrolet    Nissan     Camry LE
                             Malibu LT    Altima
                                          2.5 S

  Los Angeles
   ($4.59)       18,292       32,206       37,580      41,626      57,216
  San Francisco
   ($4.56)       18,413       32,418       37,827      41,900      57,592
  Seattle
   ($4.36)       19,257       33,905       39,562      43,822      60,234
  Chicago
   ($4.20)       19,991       35,196       41,069      45,491      62,528
  Miami
   ($4.17)       20,135       35,450       41,365      45,819      62,978
  New York
   ($4.17)       20,135       35,450       41,365      45,819      62,978
  Boston
   ($4.04)       20,782       36,590       42,696      47,293      65,005
  Cleveland
   ($4.03)       20,834       36,681       42,802      47,410      65,166
  Denver
   ($3.94)       21,310       37,519       43,779      48,493      66,655
  Houston
   ($3.88)       21,639       38,099       44,456      49,243      67,685

About This Study: Figures were calculated using EPA-estimated combined average fuel economy and current MSRP prices for all vehicles, federal tax credits for hybrid cars when applicable, and regular unleaded per gallon gas prices by city as of July 3, 2008 from the Energy Information Administration.