Used Hybrids: To Buy or Not to Buy
Hybrids have been around long enough that there is now a growing and fairly substantial used-car market for them. The question is: Would a used hybrid work for you?
Since used hybrids carry a price premium versus conventional vehicles of the same type, potential buyers must have some reason other than merely looking for transportation. If your goal is simply to end up with a decent value for a low-priced and reliable set of wheels, there are numerous alternatives that might make more sense than a hybrid. The major reasons to consider a hybrid include: You want to do something good for, or make a statement about, the environment; you want to take advantage of some state's car-pool-lane allowances for high-mileage hybrids and thus save time on your work commute; you want something with great fuel economy so you can save money on gasoline.
If your goal is oriented toward environmental issues, that's a personal choice you alone can make. But, you should be aware that modern non-hybrid vehicles are still exceptionally clean-running. They will generally produce more carbon dioxide, however, if that is among your hot issues.
If you want to shorten your commute time by taking advantage of laws in some states that allow high-mileage hybrids with a single occupant into the car-pool lanes, you should begin by investigating the details of your state's laws. For example, in California the sticker that signifies that particular vehicle as being eligible for the car-pool lane stays with the car, not the owner. Therefore, a used hybrid with the sticker will be worth as much as $3,000 to $4,000 more than one without. Add that premium to the already-greater price of a used hybrid in the first place and you could be paying a considerable amount of money just to spend less time each day getting back and forth to work. Some states and localities may no longer be issuing the highly-valued stickers, which makes the used vehicles that have them potentially more valuable.
Finally, if your goal is to save on the cost of gas, then it becomes a fairly straight-forward matter of dollars and cents. Here, at last, we can arrive at some hard numbers. As this was written (in the late spring of 2008) we investigated purchases of three hypothetical used hybrids on the basis of vehicle cost compared to fuel savings.
For comparison purposes we picked three cars which are available as hybrids or non-hybrids; for example, we did not consider the Toyota Prius because there is no non-hybrid Prius. We looked at a 2005 Honda Civic, a 2007 Honda Civic and a 2007 Toyota Camry. We chose four-door sedans, we assumed each would be in excellent condition and we assumed the 2005 Civic would have 45,000 miles on it and the 2007 Civic and 2007 Camry would each have 15,000 miles. For the Hondas, the non-hybrids were the EX trim level; for the Camry it was the XLE. This made the vehicles similar in trim and content to start with and, with a few adjustments, for such things as moonroofs and alloy wheels, we had hypothetical vehicles that, with the exceptions of their powertrains, were as alike as reasonably possible. Each had an automatic transmission.
For the fuel economy numbers we used the EPA's "Estimated New MPG" figures, which, in recognition of real-world driving habits and fuel economy results, have been adjusted downward from previous years. From those newer figures we used the Combined number, which is a mathematical calculation that ends up being somewhere between the City and Highway numbers and gives a reasonably good approximation of what folks can actually expect in daily driving.
For the pricing we used the Kelley Blue Book Suggested Retail, which is representative of dealers' asking prices and should be considered as a starting point for negotiations between a customer and a dealer.
Finally, we figured gasoline at two price levels: Four dollars a gallon, which is current pricing in many parts of the country, and five dollars a gallon, which represents a possible future increase. And we assumed each vehicle would be driven 15,000 miles per year.
There are three major points: How much more does it cost to buy the hybrid? What would be the annual gasoline cost savings for the hybrid? How long would it take to make up the higher price of the vehicle?
Here are the results:
The conclusions are clear. The higher the price difference between the hybrid and non-hybrid, the longer it will take to make up that price difference with the hybrid's better fuel economy. On the other hand, the more the price of gasoline increases, the shorter time it will take to pay off the price difference. Another point, which is not in the chart but should be obvious, is that the more miles you drive each year the shorter time it will take to pay off the price difference. Every mile you drive or gallon you burn is paying off the price difference.
Does a used hybrid make sense from an economic standpoint? Generally speaking, if it's just a matter of offsetting the price premium with the potential for better fuel economy, then certain things become fairly obvious. For example, the more you're going to drive it each year, or the longer you plan to own it, or the more the price of gasoline increases, the more sense it makes. And there is no indication that a hybrid will be particularly expensive to maintain or repair. In fact, the things that will require repair earliest and most often will most likely be those not associated with the hybrid portion of the drivetrain.
So, let's say you've decided to take the plunge and shop for a used hybrid. What should be on your list of things to check? From our investigation, it seems there's nothing in particular to check on a used hybrid that wouldn't be part of the normal shopping experience for a non-hybrid. For one thing, all the stuff that makes it a hybrid -- the motor-generator, the battery pack and the control system -- tends to be inherently quite reliable. You're still going to check the odometer reading, see how clean it is, look for past crash damage, check the tires and brakes and air conditioner, try the power windows and sound system, take it for a test drive and see how it goes, steers and stops. A hybrid will have different operating characteristics, and you might have to get used to the engine shutting off at stoplights. But, otherwise, you should probably shop for it just like you would shop for any other used car. So there is no reason to fear buying a used hybrid, but there is also no reason to believe that buying one will result in short-term economic benefits either.