In the time I have owned a Prius and the same corresponding time I have been posting to this and other Prius/hybrid boards I continue to be absolutly confused with regard to the desire to run break-even analysis on hybrids as a whole. BE is not an appropriate way to evaluate the cost effectiveness of the purchase of a hybrid vehicle. Why? Because, you cannot run a BE analysis between two non-hybrid vehicles. Running a BE analysis on a hybrid vs. a conventional vehicle is like comparing apples to chewing gum (I hope you get the distinction I'm making).

Please go here: http://www.intellichoice.com/

Intellichoice uses total cost of ownership analysis to make its recommendations. Total cost of ownership is appropriate for vehicle cost analysis because vehicles are not an investment, they are a capital expense that depreciates and eventually has not economic or useable value. So long as any one of use buys uses and maintaines a car, it continually sucks money out of our pockets. An investment actually gives you some kind of return on the money you have placed in it. So, simply put, an investment gives you money back, a liability takes money from you. Liabilities are expenses, some capital, some recurring.

But you can't do a BE analysis on something which is not the same. Instead, do a TCO analysis.

 

I too did this calculation recently; I pitted Corolla, Civic, Sienna and lease Accords against Prius, and I ended up on waiting list for a Prius #3. A Prius is never going to pay itself vs. an $ 12-15K econo box. By the time Prius comes out ahead (8-10 years) it's probably time for new batteries. But I realize how quickly I grow tired of econo boxes (or most cars for that matter) , that is why I chose the Prius, because it is as future (un-car like) as you can get in 2006. And in years to come, while that Fit, Corolla and Kia may feel/look outdated, the Prius should still deliver that new/unique experience. I also know any Toyotas will last a long time (13 year old AWD Previa still going strong), so better buy something (a Prius) that I will enjoy getting in and driving for a long time to come.

 

As I have mentioned before, i just recently pruchased my Prius. The first tank of gas, I only had 43 MPG. As I learned to drive the car, I can get 52 MPG with the AC on and 58 or so with the AC off. Last trip to gas station was 49.9. I allowed my sister to sit in the car with AC on for 45 min idiling.

How long will it take for the car to pay for itself. I drive my car for work. I get .25 per mile. So for me getting each extra mile out of a tank of gas is real important.
My last SUV was a Jeep. The SUV ran 14 MPG or $3.50 per gallon at .25 per gallon. At 50 MPG with the Pius, It get $12.50 per gallon. For those who need a calculator (like I neeed a spell checker) thats a savings of $9.00 per gallon.

Let's face it. The Prius is not going to be able to really pay for itself as compaired to some econo box on wheels. Not at the way some people are looking at it.

I look for resale value of the car. As gas prices go higher, the Prius and other hybrids will be in higher demand. Heck the Prius has been out for years, and it is still difficult get get a new one and difficult to get ahold of a used one. And the used ones are going for as much as the new Prius' are.

But if you are not looking for the resale price of the car then here's another great way to look at the car. Toyota makes a wonderful product. There are very few companies that have as much experience as Toyota in the hybrid market. So, the Prius should last a long time.

In my little world, knowing that I have a good relaible car from a good company is worth a little extra money.

A few otherpoints to consider about the Prius. A survey of Prius owners show that the average Prius owner makes over $100,000 per year, and when people see a Prius, they know it is a Prius.

 

How long does it take for any vehicle to 'pay for itself?' But what you are asking is more properly stated as "What is the total cost of ownership?" Fortuantely, we have some data points from a US Energy Department study (Google "fact_sheet5828" and "fact_sheet8976"):

$.15-$.26 / mile - Prius

These vehicles were part of a fleet study operated in Arizona that ran for 160,000 miles. Off hand, these numbers seem quite reasonable.

I found your math a little hard to follow. Did you mean something along the lines of:

$3.50 - gas dollars (US) per gallon
50 - miles per gallon, fuel efficiency of Prius
$.07 - dollars per mile gas cost for Prius

$.25 - dollars per mile, compensated expense for business use
-----
$.18 - dollars extra per mile for the Prius

$26,000 - expense of Prius, no salvage value assumed
144,444 mi. = $26,000 / $.18 - the miles needed to pay for the Prius

Ok, let's take the Scion xB with equivalent options and run the numbers:

$3.50 - gas dollars (US) per gallong
32 - miles per gallon, fuel efficiency for Scion xB
$.11 - dollars per mile gas cost for Scion xB

$.25 - dollars per mile, compensated expense for business use
-----
$.14 - dollars extra per mile for Scion xB

$16,424 - expense of Scion xB, no salvage value assumed
117,413 mi. = $16,424 / $.14 - the miles needed to pay for the Scion xB

So I bought a used, 03 Prius for $17,300 and I'm getting better than 50 MPG. Using the above figures:

96,100 mi. = $17,300 / $.18 - miles needed to pay for the used Prius

Off hand, it looks like my Prius is turning out to be a better deal than the econo-box. Then we haven't really looked at the Jeep it replaced, right?

$3.50 - gas dollars (US) per gallong
14 - miles per gallon, fuel efficiency for Jeep
$.25 - dollars per mile gas cost for Jeep

$.25 - dollars per mile, compensated expense for business use
-----
$.00 - dollars extra per mile for Jeep . . . it is never paid for!

What survey? I tried to Google it and only found a few blog references claiming $92,000. But it raises a good, testable question that we can poll here.

The other hybrids look just like their gas equivalents. As for Prius styling, From the front and side, my NHW11 Prius looks a lot like a Ford Focus except for the functional spoiler.

Bob Wilson

 

Thanks for the reply on the cost of the Prius. Some things to keep in mind while doing the math. My $3145.00 tax rebate played a huge part in my decision to purchase the Prius, I get to write the other $0.15 per mile off on my taxes.

I think that we are in agreement though. The Prius is a great buy. Yes, your used Prius will pay for itself alot quicker.

As far as pay, my pay ranks up there with the yahoo survey.

 

Except that there is NO way to have eqivilent 'options' on an xB. Many base Prius features can not be had in an xB. Nor can a Prius EVER be as ugly! That doesn't invalidate your 'break even on mileage payment math though.

 

Actually, it was a question I posed to J.D., the salesman when I picked up my 03 Prius. I asked him to give me the price for 'an equivalent or as close as possible' Scion xB to the 03 Prius I was picking up. I didn't even look at the configuration, just the final price:

http://home.hiwaay.net/~bzwilson/prius/payback.html

Bob Wilson

 

Checking into to this thread with a 2001 Prius purchased new, now with 93150 miles. With complete records my TCO is low 20's cents per mile. Frankly my impression is that you have to DIY some maintenance to stay below 25 cents/mile. Let the Toyota shops have their way at maintenance time, and you might be at 30.

But this is a long way from (for example) Edmunds' TCO calculator which places the 06 Prius in the high 40's. What up? Their depreciation used for TCO is worth examining. I invite you to compare their first-year $6k depreciation with what their true market value says about a 2005 Prius with 15k miles. Likewise, sum their first 2 years' depreciation, and compare that to TMV for an 04 with 30 K miles. Finally compare their (TMV-based) 5 year depreciation of an 01 Prius (about $9K) with the $14.7K sum for 5 years of depreciation on the 06 Prius. To be perfectly clear about it, their depreciations are fabulously overstated.

If we repair their depreciation values (which of course inherently contradict the TMV part of their website), we get much closer to what Prius' TCO really is.

As far as I can tell, there are no comparable vehicles purchased new that can touch hybrids' TCO. The diesels might come close, if we get lucky with maintenance, but then there is the emissions thing...

Getting right down to it, the math is really pretty easy. The hard part is writing the check and assuming the loan. This amounts to jumping off a cliff and believing what I and others are claiming here about hybrids. Whatever you choose, choose well!

DAS

PS: Gawd I'd love to be at 15 cents/mile. Maybe the cars in that study were under some ultracheap govt insurance program. Even as I grow old and continue to not mow down nuns in crosswalks, I still pay more for insurance than for fuel. Seems wrong, somehow...

 

Every time I see figures about whether it pays financially to own a Prius, resale value is generally never taken into account, or never realistic (always way too low).

When I was shopping for a used Prius about 4 months agao, I found that 01s were selling for as much as $12k, 04s as much as $19k. With the tax rebate and full warranty, my 06 was a bargain.

Imagine someone paying 16k or 17k for an 01 Prius, using it for 5 years and then selling it now for 12k or 13k... What a bargain (for them)!

I believe true cost of ownership can only be calculated when the vehicle is sold. With resale values currently so high, the real cost of ownership is much lower than most educated guesses you read about.

With more and more hybrids on the road, and more to come, who knows what the resale value of an 06 will be 5 years from now. Toyotas have always had high resale value, and the hybrids have always maintained very high resale value.

I guess if it all boiled down to money and money only, hardly anyone would drive a hybrid.

My old vehicle was a '96 Ford conversion van. It got about 12mpg in the city and 15mpg on the highway. It was fully paid for. Because of its low value, I had the state minimum insurance on it. Even with the minimal gas use of the Prius, it made pure financial sense to keep my gas gussler. I don't do a lot of driving and would never use enough fuel with my van to offset the high cost of the Prius. My insurance has more than doubled. Yet I am a Prius and Honda hybrid owner and love them both.