[johnson487682]

I wish more people would do the math before they consider buying a Prius. I ran the numbers and decided to buy one anyway, because I care more about the environment than my pocketbook. When my dealer said, "think about the thousands of dollars you'll save in gas", I ignored him, because I knew better. Most dealers understand little about the Prius, and most dealers will say anything to make a sale.

Unless our gas suddeny becomes expensive like in Europe (about $4 per gallon last time I was in Italy), I will have to drive my Prius for well over a decade before I'll start saving any money. Here are my numbers; you can adjust them to match your situation. I was driving a fairly fuel-efficient car, and I compared its purchase price and gas cost to the purchase price and gas cost of a Prius:

1. My last car was a four-cylinder mid-sized family sedan with a list price of $16,000 (96 Olds Achieva). I think its EPA rating was 28 city / 34 hwy, and my actual lifetime mileage was 28 mpg (miles traveled / total gas). So, it burned an average of 35.7 gallons of gas every 1000 mi.
2. The Prius is a comparable vehicle, but its list price is $5000 more, and my lifetime mileage to date is 43 mpg. (Sure, I get 50-55 mpg when I take longer city drives, but our normal usage is 10-15 minute city trips with occasional long highway drives.) I can expect this number to rise slightly as the car breaks in, so I'll assume 45 mpg, which is john1701a's average, and we live in similar climates. I will burn an average of 22.2 gallons every 1000 mi.
3. Gas prices in southeastern Wisconsin have been steady at $1.50/gal for the past year. That means the Prius saves me $18.60 every 1000 mi. I will have to drive it for 269,000 mi to save $5000. Since we drive about 15,000 mi per year (this is our only car, but we do a lot of walking/biking), this will take 18 years.
4. If gas rises to $2.50 tomorrow and my average mileage jumps to 47 mpg, it will only take me 9 years (139,000 mi). However, I think these numbers are unrealistic.

These numbers ignore other critical factors:
1. The main battery probably won't last 269,000 mi.
2. I could have earned a lot of interest on that $5000 in 18 years if I had stuck it in the bank instead of in a Prius.
3. It will take me longer to pay off that $5000, so I'll actually pay more if you include the extra interest on my auto loan.

I bought a Prius for two reasons: my 2-year-old son and my 7-month-old son. Taking care of the environment is rarely cheaper than trashing it. Buying hybrids not only reduces our personal impact on the environment, but it also encourages automakers that there is a market for such cars. They will only build them if we will buy them.

If this is your motivation, then the Prius is a great car for you to buy. If your location and situation is such that the Prius will actually save you money in a relatively short time, that's a bonus.

Douglas (2002 Silver, Wisconsin)

 

[RSnyder]

Hi Douglas,
It's great to see someone think about their purchase beforehand. I have some questions about your numbers though. You gave a 1996 value for the Olds. Any idea how prices have changed since then? Maybe that $5000 is really $4000 or $3000? Also, there's a perceived quality difference between Toyota and Olds that might also explain some of the price difference.

For my situation, I figure the price difference at around $3000, because the Honda Civics I looked at as most likely replacement candidates for my previous Civic were stickered at around $18,000 and change (in 2000). Still doesn't justify the purchase on price alone, but I also wanted to encourage manufacturers along these lines. (Plus, there's the ultra smooth transmission which was a huge added bonus since I didn't really know how nice it would be before I put in my order.)

 

[Smitty]

I did my math before buying a Prius

I did my Math before buying my Prius.

Lets not forget your Prius rebates from the IRS, $2000.00 for this year and if your lucky to live in one of the states like I do that give a Clean fuel rebate, then there is another $3000-$4000. So there is at least $6k right there in just returns.

I think the technology vs. the price is well worth it. Maybe 10-15 years ago these cars would have cost maybe as much as $35k. I could be wrong on this, but that is the way I feel.

Also look at the savings of the free 6 month or 7500 mile service on the Prius. I would say at $25 per service on average, then there is a few more bucks. ($100-$125) Buys a lot of gas. Especially for a Prius.

I studied and studied for over 6 months, before I bought my Prius, on all aspects. I also found Insuring the car was also cheaper then my wifes Olds Intrigue that is now 3 years old. The Prius is over $175 a year less for the same coverage.

So Maybe it is a geographical thing when it comes to the cost effectiveness of the Prius. But the way I see it I am saving, not loosing. Ahh, and lets not forget one less car crapping up our ozone and air. And thats a five fold for my kids. (Sheesh, I guess we were bored..)

I am gaining on mileage as the car ages. On this tank Im getting 58.6 for over 400 miles. I posted in another thread how I feel some cars seem to be "BETTER" then others. Again I think it may be a geographical thing and driver/climate related. But it seems from just they way some other owner talk about their cars they just dont seem to perform the way mine does. Me and the wife often kid that the car has a mind of its own. I guess thats ok as long as the NAV lady doesnt call me DAVE, and ask why Im doing certain things.

Nope, Toyota is holding its value, and I believe I am ahead by buying it by a long shot.

 

[johnson487682]

You both have some valid points; however, I included the caveat that your numbers may vary from mine. My point was to warn potential buyers that they should not expect to save thousands of dollars in gas.

I'll play devil's advocate:

1. Of course, the price difference depends on what car you are comparing against. Someone else might be considering a car that is less expensive than $16,000. The number $5000 is useful as an example.

2. The IRS is providing a $2000 deduction, not a rebate. That means if the federal government normally takes 25% of your paycheck (not counting Social Security, state taxes, etc.), you will see $500 in cash at tax time, not $2000. I don't know what other states are offering (rebate/credit vs. deduction), but state taxes are usually a much lower percentage than federal taxes, so this will have a lesser impact.

3. The free maintenance is nice, but it doesn't save me much, because I usually do my own oil changes, lubes, and tire rotations. This only costs me $5-$10 in supplies each time.

I agree with you that there are many benefits to the Prius that cannot be priced: I also love the smooth transmission, the cool technology, and the high mpg (I've had short-term mileages in the high 50's, so I know the car could do it if I drove that way all the time). The most priceless benefit is the big giddy grins I get while driving around--the mundane has become magical!

Douglas (2002 Silver, Wisconsin)

 

[Sheila]

I believe the federal tax deduction was $2000 in 2001. This year, it's only $1500. A lot of people don't even know that the deduction exists. Toyota didn't tell me; I read about it in the new car review column of my local newspaper.

 

[Henry]

Sheila, you are correct, according to IRS Publication 535, "Business Expenses," pp. 44-46 (tax year 2001 edition). But recently there have been numerous reports in the press, many quoted in this forum, of a change in the deduction amount to $2,000 for 2002. Before taking a line 32 "Clean fuel" deduction on your 2002 form 1040, better consult Publication 535 for tax year 2002 as to any changes from last year. I don't think the IRS will accept the Wall Street Journal or USA Today as authoritative in case of an audit!

 

[jfsmith]

Folks --This is my first post to the list, so I'd like to say how grateful I am to the administrator and members. I read the list frequently when I was thinking of buying my Prius (white, 2002, coming up on 3K miles), and it was very helpful to have the information and the sense of community.

My previous car was a 2000 Grand Cherokee, so I feel like I'm saving money on the Prius (even though I understand that I'm not, if I'd picked out a less expensive car with good mileage)--I'm spending less than half of what I was on gas, and of course there's the good feeling of driving a vehicle that's part of the solution, not part of the problem.

And I really like the way it drives. We just took our first longer trip, about 400 miles round trip from Albany to Rochester NY, almost all highway. Mileage in the high 40's, a very comfortable ride with two adults in front, three kids in back, plenty of pick-up to handle passing and hills, smooth ride.

So I guess I'd say that the intangibles really add up.

Jordan

 

[burns_fisher]

I have to agree with Douglas' main point. You may save money over time, but that's not a good reason to buy the Prius. I bought mine for two reasons, well three:

1) To reduce pollution

2) To make a statement about putting my money where my mouth is about environmental issues

3) To encourage car manufacturers to develop innovative new technology.

 

[Smitty]

Here is links to IRS and Colorado Tax sites

These are updated links,

Colorado
Alternative Fuel Vehicle Income Tax Credit

IRS
IRS Newsroom
IRS News Release pdf

Attached below my signature line is PDF of early publication of IRS ir-2002-93

Hope this clears up some questions. Of course the IRS site keeps changing, but it changes to add the newest cars, Honda Civic, etc.

 

[Michael F. Holahan]

H'lo:
I was curious about "1.50 a gallon" for the past year in Southern Wisconsin. I polled my relatives in Milwaukee, Port Washington and Baraboo who all tell me their gas prices are pretty close to ours in SW Florida i.e. 2.00-2.10 low octane. Maybe 1.99.99 at some "el Cheepo" gaseries.
While I agree that one can buy a lot of gasoline for the price of a new, mid-sized car, if one has to trade anyway; might as well get the latest in technology and help promote conservation, alternative energy and cleaner air at the same time.
regards,
M. Holahan, Sarasota.

 

[Michael F. Holahan]

H'lo:
I was curious about "1.50 a gallon" for the past year in Southern Wisconsin. I polled my relatives in Milwaukee, Port Washington and Baraboo who all tell me their gas prices are pretty close to ours in SW Florida i.e. 2.00-2.10 low octane. Maybe 1.99.99 at some "el Cheepo" gaseries.
While I agree that one can buy a lot of gasoline for the price of a new, mid-sized car, if one has to trade anyway; might as well get the latest in technology and help promote conservation, alternative energy and cleaner air at the same time.
regards,
M. Holahan, Sarasota.

 

[palo alto pinto]

low gas prices

Michael,
Please note the date of the post, 2002. Interestingly, in 2002 the poster didn't think they would see high gas prices, but I think that has changed.
I bought my Prius for the environment. But now, in 2004, the standard Camry with the 2.4 liter 4 cyl is listed as a PZEV (partial zero emission vehicle) with the same emissions as the Prius (I am surprised) and I just got my Camry for $17500. It gets 30 mpg combined (I drive conservatively) so it would take years to make up the $5000 difference in price. I want the hybrid technology to succeed, but I had a bad experience in my 2004 Prius, which left me lacking confidence. Toyota evidently knows of a problem as well...they bought my Prius back from me without me even asking them to, for which I am grateful.
Sincerely
Mark in Palo Alto

 

[hcec9]

What was your bad experience with your 2004 Prius?

 

[palo alto pinto]

My bad experience is one that several other owners had. I was driving on a highway late at night after work when the ECU decided to go crazy. I lost my electric and gas engine and had only batteries left, which at 45 mph don't last too long.After 1 and a half hours, I was towed to the nearest Toyota dealer, and after 10 days, they said they could no longer duplicate the problem. They also told they hadn't fixed anything. I picked up my car, reluctantly, and the ecu freaked again the next day. Both times this happened, the weather was fine, no rain, no recent car wash, etc. I did some homework on Prius sites like this one and found that several owners had the same experiences. It's dangerous and I lost confidence in my car. I didn't want to drive it long distance, or at night, and I definitely didn't want my wife to drive it. By the way, for 3 weeks after the second incident, after another dealer reset the factory specs on the ecu, all was well. But how do I know it won't happen again? Anyway, I kept Toyota USA informed all along and they offered the buyback out of the blue, which I find both generous and telling. I love Toyotas and I love my new Camry and I enjoyed the Prius, minus the incident. It just wasn't meant to be.
Mark

 

[richard schumacher]

Would some kind moderator please re-format the posts of this thread to fit into 80 columns?
And how did they get so wide in the first place?

 

[DanMan32]

Would some kind moderator please re-format the posts of this thread to fit into 80 columns?
And how did they get so wide in the first place?

I thought it was me! I was about to refresh the page on my browser, or even restart the browser.

 

[AgentElrond]

And how did they get so wide in the first place?

It's the mile-long URL's that do it - they just don't wrap. Works (and looks) better if they're posted with text other than just repeating the link itself.

 

[Tharkun]

Would some kind moderator please re-format the posts of this thread to fit into 80 columns?
And how did they get so wide in the first place?

Done

 

[icurrier]

Good Point

About doing the math before you purchase the vehicle. I was very concious of this, too. A lot of it depends on your normal commute, actually. My daily commute is 36 miles round trip, all on surface streets in the suburbs (there is a freeway available, but trust me -- it is NOT the faster route). I get to take advantage of the city mileage - much higher for a Prius than the comparable 4 cylinder.

So assume the $2000 tax deduction gives me $500 back in taxes, I have about $2,500 to makeup. With my daily commute, I figure on 11232miles a year. In a vehicle getting 26mpg in the city, that translates to 432 gallons. At $2.00 a gallon (about average where I am, and going up), that is $864 a year. In the Prius, I'm in between 49-51, so say 50. That is 225 gallons a year for $450 -- a savings of $414 a year. So I break even right around 6 years -- and I generally plan to own a car for 6-7 years.

So I break even. If you think thins through, the money savings are likely not an incentive to by, but not really a deterrent, either. Also figure that I get an environmentally friendly car with a LOT of nice features that turns a few heads! I'm pretty happy with it, anyway!

 

[labrat]

Re: Good Point

So assume the $2000 tax deduction gives me $500 back in taxes, I have about $2,500 to makeup. With my daily commute, I figure on 11232miles a year. In a vehicle getting 26mpg in the city, that translates to 432 gallons. At $2.00 a gallon (about average where I am, and going up), that is $864 a year. In the Prius, I'm in between 49-51, so say 50. That is 225 gallons a year for $450 -- a savings of $414 a year. So I break even right around 6 years -- and I generally plan to own a car for 6-7 years.

You guys over in the US have it great in regards to petrol (gas) prices. I'm looking at hybrid cars partly because of our gas prices. The average price here in Perth, Australia at the moment is AU$1.06/litre which converts to US$3.11/gal.
Assuming a price difference of US$3000 (that seems to be the figure used above) between a similar non-hybrid car and the Prius in the US and plugging this price into the above equation gets:

11232miles/year @ 26mpg = 432 gallons
432 gallons @ $3.11 = $1344
11232miles/year @ 50mpg = 225 gallons
225 gallons @ #3.11 = $700
Savings = $644/year

Beak even would be 4.66 years without the tax deduction and 3.88 years with.

Now of course it doesn't really work that way here because our Prius prices are around AU$37,990 (US$29,419) for the absolute base model and AU$46,090 (US$35,695) for the fully optioned model and as far as I know there are no rebates or discounts available in Australia.

The US Toyota website shows that I could get a base model Prius in the US for US$20,875 and a fully optioned model US$27,598, so you can see the difference that I am already working to overcome.

A 4dr automatic Toyota Echo (chosen because the engine size of 1.5 litres is very similar to that of the Prius) will cost me AU$16,990 which is AU$21,000 (US$16,248) cheaper than the base Prius. Using this figure in the previous calculations it will take me 25.23 years to make up price difference in fuel savings!

Obviously, to purchase a hybrid vehicle in Australia you have to be doing it for reasons other than fuel savings.