Buying a Hybrid Car – Consumer Reports Was Wrong – Some Hybrids Are
Worth the Extra Money – Save on Travelers Insurance
March 15th 2006
There are many
motivational factors that might entice people to buy hybrid cars.
First off, they can save money on gas. Hybrid cars use less
gasoline than conventional non-hybrid cars, and buyers will continue
to save money every year they own the car.
recently looked at hybrid cars and came to the conclusion that none
of them would be worth the extra cost. Hybrids do cost a few
thousand dollars more than conventional cars. After considering the
savings in fuel and adding the extra cost of registration, interest
on the price difference and other factors, the magazine concluded
that hybrids were not such a bargain.
It wasn’t until
Consumer Reports mailed out their special Automotive Issue to their
subscribers that they realized that they had made a mistake in their
calculations, and two hybrids were actually worth the extra initial
advocate magazine had to change their position on the Toyota Prius
hybrid and the Honda Civic Hybrid. These two vehicles would save the
buyer money over a five year period. Of course it was too late to
stop the presses, and their magazine was already sent out.
Reports like this
are important because consumers need to know what they are getting
in to. Hopefully they are unbiased and accurate. Out of all the
consumer reporting agencies, Consumer Reports is the most likely to
be fair. The problem is: They can’t predict the future.
What if the price
of gas increases considerably over the next few years? Prices tend
to go up, and looking at the historical trend, gas will likely go up
in price over the next few years. This will change the equation
considerably for those who opted for the hybrids.
This is a good
year to buy a hybrid car. The Federal Government is offering a tax
credit on most of the hybrid vehicles. This credit will be realized
on your 2006 tax returns due April 15th 2007. We have
compiled a chart with
estimated tax credits, and they may really help offset the added
cost for hybrid vehicles. The actual credit may vary, so
always check with the dealer for their estimate.
Last year the
Feds offered a $2,000 tax deduction. Deductions are usually not as
good as tax credits. For instance, if you made $50K, your gross
income could be lowered to $48K. Your tax savings may not be that
much. But if you made $50K and owed $6K in taxes, the credit would
be deducted directly from your tax bill, not just your income. You
would only owe $4K, if the credit were $2K. It is a bigger savings.
There is also the
savings to the environment. Less burned gas will equate to less
emissions. Also, think of the savings on future smog checks. The
cars do produce less emission, so they will likely pass smog checks
easier in states that will require them.
There may be
savings on travelers insurance as well. CBS News reported that
“Some auto insurance companies are also giving hybrid owners the key
to savings. Travelers insurance, for example, is now starting to
roll out a discount plan for hybrid owners.” The discounts can be
as much as 10%, according to Greg Toczydlowski, of Travelers
Insurance. "And it applies to the majority of the coverages."
By Dan Wilson
Keywords and misspellings: hibrid car electric pryus acord