Extra costs for hybrids are huge, study finds

2006 Lexus RX 400h (Photo: Toyota Canada)

Not only don't hybrid vehicles save their owners any money, they actually cost them a great deal more, even when driven over many years and with gas prices a lot higher than they are now.

That's the primary finding of a comprehensive study of hybrid costs conducted by Consumer Reports (CR) magazine, which outlines the penalties of owning hybrids in gory detail in the annual auto issue due out on March 7, for $6.95.

How gory are the financial details? CR found that a hybrid would cost its owner, on average, as much as $10,200 extra if driven about 24,000 km a year for five years, or 120,000 km in total.

(Except for gas prices, all figures are in Canadian dollars.)

2005 Honda Accord Hybrid (Photo: Mathieu St-Pierre, Auto123.com)

Those figures are based on gas at US$3 for the smaller American gallon and rising to US$4 over time. In an interview, David Champion of Consumer Reports admitted that the tested hybrids didn't recoup the extra costs even when gas went to US$10 a U.S. gallon. Champion further said he had no idea how high fuel prices would have to go before hybrids became a sound financial proposition.

The magazine's story also points out that the premiums for hybrids would not be recovered after 10 years, or 240,000 km of driving.

The biggest extra cost is for a 2006 Toyota Highlander Hybrid Ltd. AWD model, which could cost its owners about $15,100 more than essentially the same vehicle with a regular gasoline engine.

A 2006 Lexus RX400h AWD will cost its owner about $14,870 more over five years than a 2006 RX330 AWD.

A 2006 Honda Accord Hybrid will cost its owner about $11,640 more over five years than a 2006 Honda Accord EX sedan.

2005 Ford Escape Hybrid (Photo: Mathieu St-Pierre, Auto123.com

A 2006 Ford Escape Hybrid AWD will cost its owner about $9,480 more over five years than a 2006 Ford Escape XLT AWD.

A 2006 Toyota Prius will cost its owner about $5,960 more over five years than a 2006 Toyota Corolla LE.

A 2006 Honda Civic Hybrid will cost its owner about $4,200 more over five years than a 2006 Honda Civic EX.

Consumer Reports says it factored the following into its calculations:

• the purchase price premium for hybrids
• the difference in sales tax
• savings from hybrid fuel tax credits
• fuel savings from hybrids at the pump
• the extra cost or savings in insurance premiums for hybrids
• the extra maintenance cost or savings from hybrids
• the extra depreciation cost, and
• the extra financing costs.

2005 Toyota Prius (Photo: Toyota Canada)

To be sure, there are other such variables as tax credits and so on which might alter the financial results case-by-case, but it wouldn't be by much and those numbers show costs that are so enormous it's hard to recoup them all.

This study supports previous studies from Edmunds.com in the U.S. and the British Columbia insurance company.

More information on the hybrid costs study will be available in the magazine or the website at www.consumerreports.org/autos2006.

As for possible bias in the survey, it was plain from the way the story is reported and the way that CR staffers answered questions that they were disappointed by their findings.

2006 Honda Civic Hybrid (Photo: Honda Canada)

It's possible that they were upset that two of these vehicles -- the Highlander and the Prius -- are among their Top Picks for 2006. But in response to a question they said that operating costs played no role in making their selections for potential buyers, though operating costs make up a huge part of their reliability survey.