It’s a common dilemma. Should you trade in an old, less efficient car for new hybrids with higher mileage? Well, It does take energy to build a new car. But the energy wasted by driving an inefficient car can quickly make up the difference. In these budget-conscious times, sometimes the money difference becomes the deciding factor.
Some car buyers assume that they can’t justify the up to $6,000 more it can cost to purchase a hybrid vehicle over a comparable conventional one. However, as Hoffman Automotive in Hagerstown, a Maryland-based Chrysler, Dodge, Jeep, RAM dealer suggests, hybrid cars can bring their drivers a variety of financial savings and other perks that go beyond saving money at the gas pump—and can make a hybrid purchase more budget- savvy than one would think.
New hybrids may entitle their owners to federal tax credits ranging from $250 to $3,500. How much a given hybrid owner can expect to get from the federal hybrid tax credit depends on many factors. It makes sense to contact the IRS and find out if your proposed hybrid purchase qualifies for any tax credits.
State and City Incentives
Some states and cities also offer incentives for hybrid drivers, including tax credits, and the convenience of being able to drive solo in high-occupancy vehicle highway lanes. Many cities also offer privileges to hybrid owners, including free or discounted parking. Check your local municipality website for further information.
Employer Incentives and Perks
A growing number of employers are encouraging their workers to commute in hybrid vehicles. Believe it or not, at some forward-thinking companies, including My Organic Market, Patagonia, and Clif Bar, employees can receive up to $5,000 for purchasing or leasing a hybrid. Do the math, this essentially eliminates the price premium!
In some cases, financing a hybrid purchase can be cheaper than financing a conventional car. Many banks, especially credit unions, offer preferential loan rates for hybrid cars.
A number of car insurance providers, including Farmers Insurance Group, Geico, and Travelers, offer discounted insurance rates to hybrid owners. Be sure to inquire about how choosing a hybrid might save you on insurance.
When it comes time to resell a car, hybrid owners have been delighted to discover that their cars have held their value better than non-hybrid versions of the same model. For a quick estimate of the average resale value for a car of the type you’re considering, consider Kelly Bluebook for details. For example, a 2005 Toyota Prius is valued at $4,000–6,000 more than the resale values of other 2005 non-hybrid Toyota models.
Even if gas prices are low now, we can count on them going back up again eventually. So the real-dollar value of a hybrid car’s better mileage is likely to increase over the course of the time you would own it.
And, of course, there comes the pride of owning a car that represents earth-friendly causes. You really can’t put a price on this.
There are significant myths concerning the various alternative transportation fuels that have been suggested. That’s a shame because, as consumers and decision-makers, we should know what the truth is. Some of these alternative-fuel myths are just rooted in misunderstandings but some are rooted in misinformation campaigns fostered by opponents of new fuel. With the help of Four Seasons Ford, a Henderson, NC-based Ford dealer, we have explored a lot of the alternative fuel myths and have the following to report.
The Hydrogen Myth
The Hydrogen Myth – Hydrogen is highly explosive, and much more dangerous than gasoline.
Hydrogen is a gas that’s 14 times lighter than air. This means that when it’s burning, it tends to vent straight up, like the flame from a butane lighter. Burning gasoline, on the other hand, is heavier than air, remains liquid, and will spread out over various surfaces when it burns. Gasoline is actually more dangerous when it burns than hydrogen is.
The Natural Gas Myth
The Natural Gas Myth – Natural gas is all over America. Using it instead of gasoline as a motor vehicle fuel is a great idea. Let’s convert vehicles to natural gas and we will eliminate air pollution.
The U.S. does have enormous reserves of natural gas, although there is quite a debate over how environmentally safe it is to use fracking to unlock the gas. But ignoring that issue, gas is still a carbon-based fuel. It does burn cleaner than gasoline but it still emits greenhouse gases.
The Diesel Myth
The Diesel Myth – Diesel fuel is expensive and has dirtier emissions than gasoline.
Diesel certainly used to be a smelly, foul fuel, but a series of federal clean fuel rules in the late 1990sculminated in new requirements that have cleaned diesel up. The main issue was sulfur in the fuel, hence the nasty smell. Today’s diesel is all “ultra-low sulfur.” Since then, the general rule for diesel is that it can cause no more tailpipe emissions than gasoline.
There is some truth to the cost issue but that is a result of taxes. The federal tax on diesel is 24.4 cents per gallon, which is 32 percent steeper than the government’s 18.4-cents-per-gallon tax on gasoline. On the plus side, though, is diesel’s efficiency. Diesel engines typically return 30-35 percent better fuel-efficiency than their gasoline counterparts.
The Ethanol Myth – Ethanol is cheaper than gasoline.
Yes, ethanol is cheaper than gasoline per gallon. The problem is that it contains 33 percent less energy than gasoline, so a gallon of ethanol won’t take you as far. Numerous studies have shown that it actually costs the consumer more to use a high ethanol blend than to burn “standard” gasoline. The Grid Crash Myth – Plug-in cars might be good for the environment, but if everybody has one, they’ll crash the country’s power grid.
On an around-the-clock basis, utilities in the U.S. actually can produce far more electricity than we consume. But most plug-in vehicle charging takes place at night when power use is down and there’s a surplus of capacity. Also, a recent study by the Electric Power Research Institute found that utility companies’ grid improvements are expected to more than keep up with the relatively slow pace of plug-in vehicle adoption. This myth is busted.
The Toxic Batteries Myth
The Toxic Batteries Myth – A crisis will develop when all those hybrid and electric vehicle batteries wear out and get dumped into the world’s trash heaps.
Unlike the lead-acid batteries that are used in millions of conventional cars and trucks, the batteries used in conventional hybrids and plug-in electric vehicles are non-toxic and safe for landfill disposal. Plus, today’s EV batteries are all slated for recycling. The materials they contain are far too valuable to discard into landfills.
Despite our “myth-busting,” unfortunately alternative fuels face numerous real stumbling blocks. First, most are more expensive than the petroleum fuels they would replace and that’s a real problem. Second, they all lack a useful, widespread retail distribution system like gasoline has, and to establish a system would be a monumental effort.