By Jennifer Openshaw
RISMEDIA, July 27, 2007—(MarketWatch)—High gas prices, global-warming headlines, tax credits and other incentives have you thinking about a hybrid. Is this the time? Maybe, maybe not. But before you decide, take (at least) 15 minutes to examine the alternatives.
Back in June I added my two cents to the hybrid debate. Gas prices have risen and appear destined to rise further. Global warming headlines have readers of my new book “The Millionaire Zone,” thinking about “carbon footprints” and other things never thought of before.
Hybrids get about 50% higher gas mileage than their conventional equivalents. But they also cost 20% more — $4,000 to $10,000 more.
Federal, and some state, incentives help bridge some of the gap but not all of it. The benefit has been reduced on some of the most popular and efficient models, as on the Toyota Prius. Sales have exceeded threshold quotas, slashing the credit 75%.
So where does that leave hybrids? In financial analyst jargon, it’s about “payback period.” How long does it take to recover extra dollars paid up front?
Answer: it depends on how much you drive and the price of gas. You might save between $400 and $1,700 per year, depending on assumptions for gas prices and annual mileage. At the high end of the range, the hybrid proposition might work — assuming you don’t run into expensive battery replacements before the “breakeven point” is reached.
But what if you can’t bring yourself to lay out $23,000 or more for your gas sipper?
Perhaps you’ve bought into previous technology “breakthroughs” only to watch the price drop and the quality increase exponentially in a matter of just a few years.
Here’s an answer: you don’t have to buy a hybrid to go green. I was recently alerted to some of the alternatives through friends and car rental experiences. You can go green — get 35 mpg or more — for less than $18,000 and less than $15,000 in many cases.
And must you accept a basic 70′s-style “econobox” like a Toyota Corolla or some dull Rabbit-knockoff hatchback? Answer: not necessarily. Some of the newest designs are innovative, attractive and fun.
Here are 5 choices worth a closer look (mileage ratings shown cover the range from city automatic to highway manual configurations; my prices are for a range of trim levels from Edmonds.com or company Web sites)
- Toyota Yaris sedans (34/39 mpg, $12,025-$14,250). Innovative design, especially inside, will remind you of the Prius. Plenty of room and sporty, too. I’ve ridden in a Toyota Echo, a recent ancestor — this car rides bigger than its size and seats four comfortably and five in a pinch.
- Honda Fit (33/38 mpg, $13,850-$15,970). Like the Yaris, a new design with practical and innovative interior and controls, roomy for the footprint size, and well-equipped even at base levels. The Sport version has cruise control, 15-inch alloy wheels, leather steering wheel and an upgraded mp3 compatible audio system.
- Nissan Sentra (28/36 mpg, $14,750-$19,900). Sentra runs at the high end of my price criteria but is larger and full of innovative features like the Bluetooth hands-free phone system and “CVT” (continuously variable transmission) on the $18,400 SL version — a feature found on most hybrids.
- Ford Focus (27/37 mpg, $14,040-$17,330). The Focus has always caught my eye — pleasant styling and attractive colors; it’s built on a European platform and looks it. As long as we’re talking domestics, the Chevy Cobalt is worth a look too — it’s a bit larger and I got 34-plus mpg on a recent rental despite the advertised 24/32 EPA rating.
- Honda Civic (30/40 mpg, $15,010-$18,710). This venerable nameplate got a redesign last year and is now one of the coolest designs in the class. May be a bit more expensive, but worth a look, and it has a proven track record. If you don’t feel like giving up fuel economy to drive an automatic, this is your choice: the automatic gets 40 mpg on the highway compared to 38 for the manual.
Now, to be sure, I do like hybrids, and hybrid technology is something we should all learn about and keep track of. The point is — you can buy a very sensible car without buying a hybrid.
I know buying a new car requires more than 15 minutes of research — but knowing where to look first helps.
Jennifer Openshaw is the author of ” The Millionaire Zone” and CEO of Openshaw’s Family Financial Network. She hosts ABC Radio’s Winning Advice and serves as an adviser to some of America’s top corporations. You can reach her at firstname.lastname@example.org.
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