Show Me the Money: Which Hybrids Will Pay for Themselves First?

John Carder December 3rd, 2007 3:05 PM Link

I read the CNN piece, and it was VERY biased.

It stated that depreciation was not included. It also mentioned that “Most experts think that hybrid vehicles will lose value faster than non-hybrid ones.” What it didn’t mention was that a big part of that thinking is based on the limited lifespan of their rechargeable batteries. That may prove to be one of the biggest costs of operating a hybrid. I don’t know the figures, but let’s try a total SWAG (scientific wild-assed guess): Suppose the pack costs $8,000 to replace and has to be replaced at 90,000 miles. Using the 15k miles/year assumption in the article, that’s six years. So, you not only are paying a premium to buy the hybrid, but are also paying about $1,333/year to replace the battery pack. The really bad news is that it’s a bit like those teaser-rate mortgages. They don’t charge you $1,300/year. Instead, in six years, you’ll be looking at an $8,000 repair bill. You’ll also probably see increasingly poor mileage as the batteries wear out (are able to store less and less).

I’m not saying that hybrids don’t make any sense. They seem to be particularly sensitive to how they are operated. Even the battery temperature affects how efficiently the car operates. How long the average trip is, how much stop and go vs. steady state driving and probably most important of all, how many elevation changes, all effect the actual fuel economy. Keep in mind that the battery pack is heavy, and that additional weight requires more energy to accelerate the vehicle. In engineering, when they talk about “no free lunch”, that’s what they’re referring to. A secondary propulsion system adds weight, complexity and second set of maintenance costs.

I’d be surprised if any of today’s first-generation hybrids will EVER pay for their price premium. The next generation might, but that’s yet to be seen.

John Carder December 3rd, 2007 3:08 PM Link

affect, not effect in the second-to-last paragraph. Sorry about that.

Ducati Minor December 3rd, 2007 3:56 PM Link

The one that will pay off first is the one that came free.

Steve December 3rd, 2007 4:17 PM Link

… Didn’t I read somewhere about a gentleman that had driven his Prius 250k miles with no battery pack replacement?

chuck goolsbee December 3rd, 2007 4:39 PM Link

I work in an industry that uses batteries (and Diesel generators) to provide back-up electrical power. I’m very familiar with batteries and their life-cycles. The number of miles driven is irrelevant on the lifetime of a battery string in a hybrid car. The more critical factors are charge-discharge cycles and the temperature extremes the batteries have endured. Both extreme heat and freezing temps have an impact on battery life. Our batteries enjoy a life of luxury, kept under perfect environmental conditions and inspected twice a year. We sink money into a battery-replacement account every month because we know that somewhere between 3 and 5 years into their life, every damn one of them will HAVE to be replaced. We have 4 strings of batteries, which for all intents are identical to what are used in the automotive business and we spend $32,000 to replace them every 4-ish years.

Miles driven is easy to quantify, and an accepted measure of a car’s wear & tear… but there is absolutely NO WAY to ascertain the conditions that a hybrid car’s power system has been through to the potential second-hand buyer.

I imagine that some used-hybrid buyers will have no issues, and others will have nothing but (expensive) problems. Roll the dice.

Me? I’m sticking with Diesel.

–chuck
http://chuck.goolsbee.org

Jonathan Fung [Gotakon] December 3rd, 2007 10:09 PM Link

“The other end of Toyota’s Hybrid range, the barely-there hybrid of the Lexus LS600h L, which will recoup its $15,458 premium in a scant 3,771 years. Better make that the extended warranty.”

Ouch. Things aren’t looking too good for the LS600hL, especially after that MotorTrend piece which ranked it last, and blasted it for big claims and low performance. But I guess that’s the way to go if you want your huge luxo sedan to appear green.

Jason December 4th, 2007 1:39 PM Link

The hybrid battery replacement myth will take some time to disappear but it is only a matter of time.

First, hybrid batteries don’t cost $6K, $8K, or $10K to quote a few examples thrown out from media articles I’ve read. The Toyota MSRP price for a Prius hybrid battery pack is $2985.13. http://www.toyotapartscheap.com has OEM battery packs listed for $2388.18. It also only weighs 98 pounds. I look at this as about the same price as a replacement transaxle if the battery ever needed to be replaced. Do you stay up at night worrying that your transaxle will fail?

Second, the likelihood of replacing a battery pack is remote. Toyota warranties the hybrid system for 10 years or 150,000 miles in CARB states. For Non-CARB states the warranty is 7 years of 100,000 miles. In Canada, several taxi companies have replaced their conventional cars with the Prius and have driven them 250K miles or more without any problems.

I think when New York City converts a large percentage of its taxi fleet to hybrids without huge numbers of battery failures the myth will finally die out. Until then, you will still hear wildly exaggerated predictions of hybrid battery failures by those afraid of new technology.

Winding Road » Archive » Hybrid Cars Must Offer More Than Just Image December 4th, 2007 4:36 PM Link

[…] that class of car was seen mostly as an option for those who were extremely eco-minded only. The price premium and limited availability of the cars meant that they still weren’t a practical option for most […]

Ducati Minor December 4th, 2007 9:36 PM Link

“The hybrid battery replacement myth will take some time to disappear but it is only a matter of time.”

Finally, someone said it.