Real cost of a car vs fuel economy

I guess if you're taking comfort, features and such out of the equation, a $200 used motorcycle would make the most economical sense for transportation. I picked up my first motorcycle for $75 and rode it for several years. It would do freeway speeds and got 70-ish mpg. I sold it for $250 after riding it for 3 years and spending $200 on maintenance over that time. That's a whole lot of return on investment right there, $25 + fuel for 3 years time...

 

So you include interest rates on savings, currently running 1% APY on a 5 year CD, so about $200. But don't include increases in gas prices, currently around 8.1% (March 2011 - March 2012). That $200 got eaten up by merely the increase (1 years worth) in gas prices in 689 gallons.

Try that payback calculation including the 8.1% increase in gas prices and see what you get. Or better yet, don't; figure the monthly expenses instead.

 

No, it's important for the USA to encourage the purchase of cars built by US companies in the USA using a high proportion of US parts that get high mileage since it is in the national interest that the US uses less oil while not relying on other imports to do so.

I'm not kidding myself that buying a Prius is particularly helpful to the USA. There are far better ways to help than giving $20,000 to Japan to save importing 60 barrels of oil every 10 to 12 years.

 

You are double dipping. You can't ADD the interest on savings to the cost of financing.

But no, let's go with that, unfair as it is. You start with the price of a car + 4,000. You buy a lesser car, and put the 4k in a CD (at 1.1% APY). I start with just the price of a car, and finance the extra $4,000 (at 3.7% for 5 years) to buy a Prius. My Prius gets 50 MPG (less than mine really does), and your lesser car gets 30 MPG. We both drive 12,000 miles per year, therefore I use 240 gallons /year, while you use 400 gallons. Gas prices go up 8.1% per year (just like the most recent 12 months)

Year 1, 2012 (gas at $4.00 / gallon)
I pay $878 in loan payments, and $960 for gas = $1,838 Total: $1,838
You pay $1,600 for gas, and get $44 in interest = $1,556 Total: $1,556

Year 2, 2013 (gas at $4.32 / gallon)
I pay $878 in loan payments, and $1,037 for gas = $1,915 Total: $3,753
You pay $1,728 for gas, and get $44 in interest = $1,684 Total: $3,240

Year 3, 2014 (gas at $4.67 / gallon)
I pay $878 in loan payments, and $1,121 for gas = $1998 Total: $5,751
You pay $1,868 for gas, and get $45 in interest = $1823 Total: $5,063

Year 4, 2015 (gas at $5.05 / gallon)
I pay $878 in loan payments, and $1,212 for gas = $2,090 Total: $7,841
You pay $2,020 for gas, and get $45 in interest = $1,975 Total: $7,038

Year 5, 2016 (gas at $5.46 / gallon)
I pay $878 in loan payments, and $1,310 for gas = $2,188 Total: $10,029
You pay $2,184 for gas, and get $46 in interest = $2,138 Total: $9,176

Year 6, 2017 (gas at $5.90 / gallon)
I pay $1,416 for gas = $1,416 Total: $11,445
You pay $2,360 for gas, and get $46 in interest = $2,314 Total: $11,490

Year 7, 2018 (gas at $6.38 / gallon)
I pay $1,531 for gas = $1,531 Total: $12,676
You pay $2,552 for gas, and get $47 in interest = $2,505 Total: $13,995

Year 8, 2019 (gas at $6.90 / gallon)
I pay $1,656 for gas = $1,656 Total: $14,332
You pay $2,760 for gas, and get $48 in interest = $2,711 Total: $16,707

Year 9, 2020 (gas at $7.46 / gallon)
[Edit: This was a copy of year 8. Now fixed]
I pay $1,790 for gas = $1,790 Total: $16,122
You pay $2,984 for gas, and get $48 in interest = $2,936 Total: $19,643

Year 10, 2021 (gas at $8.06 / gallon)
I pay $1,934 for gas = $1,934 Total: $18,056
You pay $3,224 for gas, and get $49 in interest = $3,175 Total: $22,818

Then we crash into each other, negating any re-sale value (to make this as unfair as possible). So, we compare notes while waiting for the tow trucks. You started with $4,000 more than I. At the end of 10 years, you spent $3,616 more than me (even counting the interest you got). Your advantage dwindled from $4,000 to a measly $384. If I had only made it one more year, I would have overcome all of your advantage. If we had started even, I would be up $3,616. The most I ever spent per month more than you was $21. At worst, I was down $718 total, out of pocket.

[EDIT: Missed in year 9. Fixed number is $4,762 to the good, on the side of the Prius by year 10]

 

Is there a standard for calculating TCO for cars? Fleet companies calculate on different metrics to the private owner; it's all about the financing. But it might be a baseline on which we could agree as a starting point?

I used to look after a fleet of government cars. The provider based lease rates on their calculation of TCO and resale. The standard lease was 24 months / 40000km. However, the "standard" government car was automatic with A/C and airbags. In the early days, those 3 keys features were options (Australians have worn seatbelts since the early 1970's so airbags were first seen as a luxury.) The base model Ford Falcon or Holden Commodore had none of these but the next model up did. Strangely the lease cost for the higher-spec models were less than for the base models.
Therefore, adding those options did not translate to better resale for the base, whereas the already-equipped models were resold at a proportionally higher price.

When the Mitsubishi Magna changed to 15000km services intervals, the lease equation made it much cheaper than the Falcon and Commodore. Paying for 2 services at 15-, 30000km instead of 5 at 1500km, 10-, 20-, 30 and 40000km made a huge difference over the life of the lease. In fact, the luxury Mitsubishi Verada model leased at the same price as a Falcon, though it sold for $10000 more.

(BTW, fleet sales accounts for a very high proportion of new car sales in Australia. I might be wrong if I said 65%, but it is a significant chunk and greatly affects the market.)

Apropos... I recently stopped to help a Lexus driver who had broken down. As we discussed cars, he mentioned that he had considered buying a Prius as a second car but his son convinced him that he would 'never get his money back' on the fuel. I asked why he bought a Lexus when a Kia is so much cheaper. Moral: There are many intangibles that won't fit into an equation to explain to someone else why you made your decision.

 

The TCO for most fleet vehicles is very different from individual owners.

Most fleet operations where fleet vehicles are similar to vehicles owned by individual owners are owned for 3 to 5 years before they are sold off and replace, e.g. a car rental operation, which is far shorter than the average ownership of individual/personal owned vehicle of 8 years. When fleet operations use specially outfitted vehicles, e.g. police cruisers, transit buses, and postal delivery trucks, there is a tendency to how the fleet vehicles far longer, e.g. 10 to 20 years.

In the end, your TCO should be based on your expectations of how long you think you will own your car. My previous car was a 1990 Honda Accord LX with Automatic transmission which I paid $14000 for in August of 1990....and then gave away in April of 2010 ... my TCO was over 19.6 years ... the Accord's fuel efficiency was initially 24 mpg but dropped to 22 mpg when I replace the Honda's more expensive OEM LLR Tires with regular less expensive tires. In 1990, gasoline was about $1.20 per gallon so 24 mpg seem rather decent for fuel efficiency then. There are times when I ask myself what if I had gotten a more fuel efficient Honda Civic in 1990 instead? I probably would have saved more in fuel cost.... I suppose replacing the 22mpg Accord with a 50mpg Prius looks like I'm trying to compensate for lost time doesn't it???

 

Of course you can and should.

$4,000 invested over 10 years at current stock market return of 8% would be $8,635.00 compounded which would trump the fuel savings over 10 years.

 

The Prius can get over way over 50mpg if driven a certain way but if
driven another way might only get 20 mpg. Its soo true that YMMV.

Likewise, returns from the stock market may vary as well...
If you had invested $4000 in 1992 in a Vanguard S&P500 index mutual fund it would be worth about $13000 now. But if you had invested $4000 in 2007 during the stock market bubble but before the Great Recession, you should count yourself lucky that your stocks are worth now about 75% of what you paid for it (your $4000 is now about $3000). Bad luck or a just one bad investment in the stock market can be a real game changer. Even using mutual funds - you can lose your entire investment..

With respect to full disclosure:

I own a 2010 Toyota Prius III and I own stocks via Vanguard S&P 500 mutual funds.
I'm hypermiling the Prius so I'm getting 59 mpg and I've estimated that I've saved 695 gallons of gas over the course of two years (average price of $3.25 per gallon) by switching from a 1990 Accord to a 2010 Prius.

Some my IRA mutual funds took steep nose dive after the Great Recession and are some of my domestic ones are worth 25% to 50% less than what I paid for them before the crash. Only my international mutual funds have seem to have bounce back up.

 

How? We both start with $20,000. Please show how you can have $4,000 to invest, while I have to borrow $4,000?

So where in that is the interest on borrowing $4,000? You couldn't even keep it in your own example.

So trying again, we both start at the same $20,000. You put $4,000 in an infallible stock market (ha!). I put mine in a Prius. Same $12,000 miles per year. Same 240 gallons per year in the Prius, 400 in the lesser car.

Year 1:
I save $640 in gas (160 * $4).
You get $320 in interest from the stock market. Total: $4320
[ Oh look, I am ahead already. ]

Year 2:
I save $691 in gas plus I get $51 from the $640 in the stock market.
Total: $1382
You have $4,665

Year 3:
My Total: $2,240 ($1382 * 1.08 + 160 * $4.67)
Your Total: $5,039

Year 4:
My Total: $3,227 | Your Total: $5,442

Year 5:
My Total: $4,357 | Your Total: $5,877

Year 6:
My Total: $5,650 | Your Total: $6,347

Year 7:
My Total: $7,123 | Your Total: $6,855
[ I now have more in the stock market than you. ]

Year 8:
My Total: $8,797 | Your Total: $7,403

Year 9:
My Total: $10,693 | Your Total: $7996

Year 10:
My Total: $12,839 | Your Total: $8,635

So, if there is a risk-free stock market at 8% to put savings into, buying a Prius instead of a lesser car WINS by $4,204 over ten years. Plus my car is worth more. And I got to drive a Prius for 10 years...

 

Driven how? By pulling two oxen behind it? Dead oxen?

We occasionally see complaints from people with broken Prii, who are complaining about getting miles per gallon in the 30s. I have never heard anyone getting 20.

 

I did some calculations between different Toyota models. In case of Prius and average distance 15 000 km/year you could go for Avensis with 1.8/147HP petrol engine and Multidrive-S (CVT) transmission. In Poland it's SOL-PLUS grade something like Life in Prius.
Assuming same insurance cost (we pay for insurance based on engine size, not power - 1.75 235 HP Alfa Romeo owner will pay less than 136 HP, 1.8 Prius), similar service cost, only basic car price and consumption difference - over 6 years lifespan final TCO will be the same.
Comparing Prius and Lexus CT200h, second one is cheaper (in it's basic specification). Basic Prius vs basic CT200h if one don't need bigger car - is better option.

Comparing Auris hybrid to non-hybrid cars in a no-go. Fuel savings will not compensate high (premium) price for it. Especially if you compare it to Auris 1.6 132 HP or Auris 1.4 Diesel 90 HP in their premium specs.

Prius will show it's power when driving in the city, country roads, up to 110 kmh / 70mph. If you will push it harder - every Diesel will win.

 

Rolling down hill like soap box derby but we are talking real world 50 mpg and fact that average use will not see fuel savings break even for 5-7 years.

 

Fuel savings beat your 8% stock market first year. 10 years, beat it by over $4,000. And you are still on this 'break even' kick?

Real World, my sweetie (who doesn't drive in any special way) gets 53 MPG.

 

I've been driving a 2010 Prius in the real world for over two years and 23000 miles and I'm getting 59.6 mpg overall. My commute is 16 miles one way - mainly stop and go. I am slower than most drivers to begin with so I would say my overall Fe would drop to abou 50 mpg if I wasn't hypermiling. Fuelly.com data suggest the average 2010 Toyota Prius driver is getting about 47 mpg. I paid $23K for my 50 mpg 2010 Toyota Prius III which is about $4k over an estimate price of $19k 27 mpg 2010 Hyundai Elantra Touring GLS/AT w/ Preferred package ( the alternative conventional gas vehicle I was thinking of getting). I'm only driving about 11,000 miles a year. Looking only at a relative fuel efficiency difference between 50 mpg to 27 mpg ( 23mpg differential is equivalent to 220 gallons vs 407 gallons of gas ...OR... 187 gallons per year) with the average price for gas over the last two years has been about $3.25 per gallon, the fuel savings from the Prius over the Elantra Touring GLS/AT would be $607 per year. Assuming that the price of gas is fixed for all eternity (which is highly unlikely), the fuel saving of the Prius would start eating into the $4,000 difference between the two vehicles at about 6.5 years which is within 5-7 years. At 60mpg using hypermiling, the break even point is 5.5 years - if the price of gas stayed constant.

I suppose I could bemoan that I'm not saving enough money - but honestly I'm pretty pleased about getting a Prius... there are time when I think that I would have been happier with a different color though...and there are times when I sometime think I might have been happier with a generation 2 over a generation 3 ...generation 2 is more like the original star trek and generation 3 is more like the next generation star trek... However, I am pretty sure that getting the Prius was the right choice for me atleast. It completes the inner geek in me...

 

A Prius' fuel efficiency can vary widely depending not only on how it is driven but what kind of driving environment it is being driven in.

To really get the lowest fuel efficiency from a Prius, all you have to do is never let the Prius ICE warm up over 130 F degrees by never driving a Prius for longer than 5 minutes per trip from a cold start - under those conditions the Toyota Prius/Ford Fusion hybrid will get about 25 mpg. If you drive a Prius like they did in that Top Gear episode by going over 50 mph around tight curves - your not likely to get over 30 mpg.

 

That's nice but the vehicle is rated 50 mpg and that's what most people get driving it. If you want to claim 60 mpg using aggressive techniques the raise the comparable non-hybrid to 40 mpg.

The comparison stays the same, the hybrid premium cost is not repaid in fuel savings for 5-7 years.

 

Actually the "hybrid premium" for the Camry is $3400, comparing the Hybrid XE vs the XE, which may be similarly equipped since both are "XE" models??:
2012 Toyota Camry models and prices
At 12K miles/year, the $3400 pays out in 6.25 years, sooner as gas prices rise above $4.
At 15K miles/year, payout is in 5.0 years.

Incidentally, comparing VW Jetta models, the "diesel premium" is $2430-2700. EPA combined mpg's are 34 diesel vs 26 gas.
At 15k miles/year, payout is in 5.0 years (assuming equal $4/gal prices for diesel and gas, which probably isn't a good assumption!)

Also interesting: the Jetta diesel 4-door sedan with AT is almost exactly the same MSRP as the base model Prius: $24,000. Prius has better mpg, slightly more interior space, and probably better reliability.

 

in my situation.

April; drove Prius 1387 miles paid $121 and change for gas.
Leaf drove 1325 miles paid about Thirty bucks for juice.
Prius averaged 47 mpg so what would gas cost be in other cars?
Focus at 33 mpg $168 at $4 gas (ya, its only $3.93 but whatever)

so the Leaf saves me about $90 over a Prius, $140 over a Focus. now, discounting tire issues (having replaced one and collected a humongous bolt on another yesterday) i have had no maintenance costs other than a voluntary brake fluid flush and change for $80 over 16,000 miles and cabin filter i changed with cost $11.

on the Prius, did the filter change (cabin/engine) twice at $24 a shot =48 and oil change twice $72 and $78. = 150 but am good for about 9500 miles before i have to do that again.

now, i could reduce my Leaf costs (there are currently a few hundred free charging stations in the neighborhood) but it simply aint worth it. sure i plug in when i can because i would like to have others see my Leaf charging so i save a few bucks doing it.

in March, i purposefully plugged in as much as was feasible but only saved myself like $5, but if motivated enough, people could get a large portion of their juice free for now. there is a Chevy Volt that plugs in downtown nearly every work day, so am guessing they are doing well

but on a yearly basis extrapolating costs for this year

the Leaf should do about $350 in electricity on just under 14,000 miles
the Prius should do about $1150 in gas for the same distance
the focus averaging 33 mpg should do $1700

so, if buying a Leaf over a focus, the payback is about 3.5 years. over a Prius, about the same. now this formula is complicated by options some of which are not available on the focus except in the platinum trim which is over $23,000 plus tax.

one could easily add a few years to the payback by dropping features or pricing against a Prius C which is closer in size to a Focus but then you are looking at an optimum scenario favoring gas and i find that to not be an option for most.

 

Really? What's the price differential between the Leaf and the base model Prius ($24,000)? What are the tax incentives on the Leaf?

(I don't believe on basing decisions solely on the payback time, and in any case the numbers shift a lot depending on the assumptions they're based on. But I suppose this IS a thread about numbers and assumptions.)

 

Today I have owned my Prius for 3 months. I have spent $432 on fuel so far. Since my last car was getting half of the mileage I am currently getting with my Prius, I have saved at least $432 in fuel. The reason why I say at least is the fact that we now take the Prius on trips which we would have normally taken our 2004 Highlander, which only gets 17 MPG.

Whenever we use the Prius in place of the Highlander I am saving about $16 for every 100 miles traveled.