Save $611 per year with a hybrid car
With car insurance prices soaring and car loan interest rates rising over the past few years, owning a car has become increasingly expensive. There is good news for car buyers recently. As the global economy navigates (hopefully) the worst of the supply chain challenges caused by the pandemic, used car prices are down about 7% during 2023.
But regardless of your budget situation, buying a car is never a cheap or simple endeavor. If you want to save on gas and the total cost of car ownership, you may be tempted to buy an electric vehicle (EV) in 2024. But EVs can be expensive. As of January 2024, the average price of a new EV was $55,353, compared to the average new car price of $47,401, according to Kelley Blue Book. It could take several years to save enough on gas to make up the $7,952 difference in upfront costs.
If you’re not ready to buy an EV yet, purchasing a hybrid vehicle can help you save money on gas while eliminating range anxiety. Let’s look at some examples of how much money you can save with a hybrid car compared to a conventional gasoline car.
Why buy a hybrid car instead of an electric car
Even if you’re concerned about climate change and interested in EV tax credits, not everyone is ready to buy a fully electric vehicle. If you don’t have a garage or an easy way to charge your EV battery at home, it’s natural to feel anxious about the range of your EV. Especially since free, reliable public EV charging stations aren’t always easy to find.
Hybrid vehicles do not cause range anxiety. This is because, like a regular car, it runs on 100% gasoline. But hybrid cars can help the environment (and your bank account) in other ways, too. In other words, it is much more fuel efficient than a regular car. And this can make it worth buying a hybrid car, even if the cost is slightly higher than a standard gasoline car.
How much gas can you save with five hybrid vehicles?
The best way to understand hybrid car savings is to compare its fuel economy to that of a standard gasoline car. The U.S. Department of Energy provides a free calculator at FuelEconomy.gov that shows how much you could save with a hybrid vehicle by comparing MSRP (selling price), fuel economy, and more.
Read more: Find out how to choose the best car insurance company.
Here are some makes and models of hybrid vehicles, taken from the U.S. Department of Energy calculator: Let’s assume that each vehicle drives a national average of 13,476 miles per year, with the current (as of May 4, 2024) national average gas price being $3.659 per gallon.
Here’s a look at how much you’ll save on gas with these five hybrid vehicles compared to regular “non-hybrid” versions of the same cars.
Manufacturer and Model | EPA Miles Per Gallon (MPG) | Non-hybrid MPG | difference | Estimated gas savings (1 year) |
|---|---|---|---|---|
2024 Kia Sorento Hybrid EX FWD | 37mpg | 23mpg | 61% | $811 |
2023 Kia Sportage Hybrid EX AWD | 38mpg | 25mpg | 52% | $673 |
2023 Ford Escape ST-Line Elite Hybrid AWD | 39mpg | 26mpg | 50% | $632 |
2023 Toyota Corolla Hybrid LE | 50mpg | 35mpg | 43% | $423 |
2023 Hyundai Santa Fe Hybrid Limited AWD | 32mpg | 24mpg | 33% | $514 |
Data source: FuelEconomy.gov and author’s calculations.
The exact savings will depend on your vehicle type and how you drive. As you drive more miles or gas prices rise, the cost savings of a more fuel-efficient hybrid increase. But based on these estimates, these five popular hybrid car models will give you the following benefits: The average annual gas savings is $611.
Want an EV tax credit? Choose this special type of hybrid vehicle
One downside to hybrid cars is that they don’t qualify for the EV tax credit. However, there is a special type of hybrid called a plug-in hybrid electric vehicle (PHEV). I drive a plug-in hybrid Toyota Prius Prime, and it’s my favorite car.
You may be eligible for a new EV tax credit of $3,750 or $7,500 on some new plug-in hybrid electric vehicles, such as the Ford Escape plug-in hybrid or Chrysler Pacifica plug-in hybrid. However, only some vehicles are eligible for the new EV tax credit. This depends on where the car was assembled and where the car’s battery components were sourced.
Or, if you want to choose from a variety of car manufacturers, you can get a used EV tax credit of up to $4,000 on a used plug-in hybrid. This can be a good strategy to save money on a used car in 2024.
Keep in mind that your income must be below the qualifying limit to receive the EV tax credit (new or used). Visit FuelEconomy.gov for more information.
conclusion
Find cheap car insurance quotes before you decide to buy a hybrid car, plug-in hybrid, or any other vehicle. Hybrid car insurance can sometimes be 7% to 11% more expensive than standard vehicles, according to insurance company Lemonade. You may want to increase your deductible or try other cost-saving strategies to reduce your car insurance costs.
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