Hybrids: Save gas, lose money

Consumer Reports says hybrid cars will lose value faster than other cars. Are they right?

NEW YORK – Buying a hybrid will save you money on gas…but you might still come out behind.

One of two main reasons, according to a recent analysis by Consumer Reports, is an additional cost that has typically been treated as an unknown: depreciation. Another factor, the report found, is purchase price — hybrids simply have higher sticker prices than their non-hybrid counterparts, and gas savings don’t do nearly enough to close the gap.

According to Consumer Reports’ analysis of six hybrid gasoline/electric vehicles, they will lose 2 percent to 3 percent more in value over five years of ownership than otherwise identical non-hybrid vehicles.

With the purchase price difference, depreciation and other costs like financing and insurance factored in, only the Toyota Prius and Honda Civic Hybrid would save owners any money — $406 and $317, respectively, over 5 years. That final figure includes the impact of a federal tax incentives for hybrids. Without those incentives, Prius buyers face a net cost of ownership of $2,700 more than Corolla buyers.

Other hybrid vehicles would cost owners thousands more than non-hybrids over five years of ownership, even after federal tax credits.

CNN/Money