The High Price of Hybrids

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A Volkswagen Jetta TDI diesel-powered car, however, can make the journey without stopping, getting 45 mpg (see BW Online, 2/15/06, "Selling the Love of Diesel").

The Prius and Civic Hybrid delivered an average fuel economy in real-world driving by CR testers of 44 and 37 mpg. Those were the top fuel economy ratings of any five-passenger vehicles tested by the magazine. The Ford Escape Hybrid, which achieved the best fuel economy of any SUV tested by CR, can save an owner about $660 per year in gasoline costs. The reason the payback doesn't come for five years is because of the higher price of hybrids, even after Federal and state tax breaks, as well as maintenance costs. The Ford Escape hybrid costs $26,900 to $28,525, while a gas-only Escape costs $19,380 to $26,680 and offers at least $2,000 in discounts to every buyer.

But the CR calculations don't take into account the emotional dividends that hybrids deliver to owners. Hybrids emit less pollution, with some models classified as Partial Zero Emission Vehicles by the California Air Resources Board. Each gallon of gasoline not burned prevents the emission of 19 pounds of carbon dioxide, which many believe contributes to global warming, says CR. So, for people who buy hybrids out of a sense of environmental responsibility, breaking even on the costs of a gasoline-only powered vehicle is not disappointing at all (see BW Online, 2/13/06, "The Top Ten Hybrid Myths").

"I SAVE A BUNDLE."

"There is no question that the government should step in at this point and close the gap between the cost of hybrids and gasoline-only cars. It's clear that [hybrids] improve the environment, and I'll pay extra to do the right thing," says Berta Carrolton, a graphic designer who drives a Prius around San Francisco (see BW Online, 12/28/05, "Hybrid Owners Drive Away Happy").

Adds Ben Hampton, a Leesburg (Va.) attorney who drives his Civic hybrid to his office in Washington, DC, most days: "If time is money, I save a bundle." Hampton says the additional cost of a hybrid is well worth it because he can drive alone in the HOV lane.

David Kiley is a senior correspondent in BusinessWeek's Detroit bureau.