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Paying more than MSRP for (new) Hybrids, Depreciation/Value of used Hybrids
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NO, I do not see any usable logic in what you are saying or what the original poster is wanting to do. Changing cars every 3 years with very low mileage is senseless and a huge waste of money. Buying a used Prius at nearly the same price as a new one is even dumber. If the Prius could be had for less than a new Corolla it may have a slight bit of merit. I do not think people that drive less than 5000 miles per year need a hybrid. You are just asking for trouble. There is no good logic to paying the $3k-$10k premium for any hybrid if you are only driving a few miles per year. The only chance of recouping that premium is driving lots of miles in a short period of time. Show me how you can recoup even $3k with gas savings driving less than 5k miles per year. Use a Corolla as your example not a Hummer2.
You may be right. However that is, according to Edmunds, about the trade-in value for that car if it has a NAV. What is really stupid is there is a 2004 Prius with only 12k miles and 47 bidders already to $18,600. That is for a car with a salvage title. You talk about some loonie bidders. Anyone like to buy a raffle ticket for the London Bridge?
Post it on eBay... some moron will enter a bid. (Don't forget to specifiy a $30.00 shipping charge and payment by PayPal only)
Gary, I'm not talking about ANYTHING EXCEPT addressing this ONE PERSON'S needs !!
I'm Not Saying that this logic is the best, or the smartest, or the most financially sound *UNDER NORMAL CIRCUMSTANCES."
But for this one case:
1. Driver only drives 4500 miles a year.
2. Driver trades cars every 3 years.
Buying a USED CAR is ABSOLUTELY better *for this one person in this one case* and there is nothing anyone can say here that will make that statement untrue.
Firstly, he/she will NOT be paying a premium at all. The driver will be paying for a car which has an "added cost option" called an HSD electric power drive system. There is no other "comparable car" to the Prius, so it is not "paying a premium" AT ALL. It's paying for an option called "electric drive." So it's not a PREMIUM at all - it's "paying for an additional option not available on the Corolla AT ALL." It cannot be called a "premium" if it does not exist on the car you are comparing it to.
So for this buyer, the choice is clear. Buy the comparably priced, possibly Cheaper, BETTER EQUIPPED Prius, and gain 12-15 MPG for the 15,000 miles, which will translate to good money if gas prices continue to hover around $3 a gallon.
Clear as the frown on your face, Gary !!
I'm always smiling. I am following what you are saying. I got the impression this person wanted to buy a NEW car every 3 years. Maybe to have that B to B warranty. I agree that it is not very good economics. You are saying buy a used car every 3 years rather than a new one. I don't see the logic in that either. If you can afford a new car every 3 years. Why would you buy a used one. If you can only afford a used car. You should keep it as long as it is running.
The economics on driving 15k miles is pretty simple. In a Prius you will spend $900 on $3 gas. In the Corolla you will spend $1500 on gas. That is $200 per year savings in gas. Unless you can get a REAL bargain on a Prius you are going to lose money. And if people are offering $18,600 for a 2004 salvaged Prius. There is too much buying frenzy surrounding the Prius to make it a logical choice new or used.
Lastly if he wanted a used car why not keep what he has? That is the smartest & most logical thing to do for someone that drives 5k miles per year.
As far as emissions, at 4500 miles a year, the Prius will produce:
40% less Carbon Dioxide
55% less Carbon Monoxide
40% less Nitrogen Oxides
40% less Hydrocarbons
That's significant percentagewise....
That would be my criteria for long battery life. And I am not interested in unsubstantiated stories from Japan & Russia on the longevity of the hybrids. I know in Japan they do not put many miles on a car before it is recycled. That is why we import so many used Japanese engines with about 35k miles. The oldest hybrids on the road in the USA are about 6 years old. They are Insights, and there are cases of the batteries weakening to the point of not being usable. You can get away with that in a Honda, not in a Prius or other HSD type hybrid.
I'll reserve judgment on that assessment. The jury's obviously still out on that one.
Just want to remind everyone to NOT let it become personal. Nothing but trouble in that direction. Thanks!
If a particular supply and demand opprtunity gives a BUSINESS a chance to MAKE MORE MONEY (the goal of virtually every for-profit business in the world) then who are we to begrudge them the right to make that money? No one FORCES someone to buy ANY car, at least not legally.
If those poor, overpaid fools want to pay three to five to seven thousand dollars over the "Holy Grail" MSRP number, then more power to the dealer for getting people to do that !! Remember: every car dealership EMPLOYS people and pays people, which puts more money into the economy and reduces the unemployment lines.
The good part of selling hybrids at any price is that it gets MORE HYBRIDS on the road, which means more R&D money going into the development of future and better technology, which is better for EVERY AMERICAN !! Every one !! All of us !!
Today's hybrids will lead to tomorrow's better batteries and then to hydrogen fuel cells or whatever ends up being the next HUGE advance in vehicle efficiency.
Forget the MSRP thing - it's just a "power thing" for people to feel good about themselves that they could "bargain the dealer down" which really means nothing unless you are paying cash and have your own mechanic - the car dealer makes money on every car sold, regardless of selling price - service being the major money maker.
If someone wants to "pump their chest" because they "beat" the dealer, more power to them. But it's not that major an accomplishment, because the dealers have a monopoly, and thousands of people pay more than MSRP in the long run. If you don't think it's a monopoly, call Toyota Corporate and try to order a car direct from them.
If money is no object, the cost of fuel is superflous. Some people drive hybrids, not to save money, but to make a statement, e.g. Leonardo DiCaprio who drives a Prius. Obviously, he can afford to drive whatever he wants.
Buying used Honda's or Toyota's is a good thing - to a point. If you are looking at buying a 1 to 3 year old vehicle, you're better off buying a new Honda or Toyota due to their high resale value on the market. At our local dealer, I can buy a new 2006 Camry LE for less than what they're selling 2005 Camry LE's with 12K to 15K miles.
Huh? With the Honda design, the electric motor works to assist the ICE, so both are working at the same time.
I think you meant to say that the Prius allows electric and ICE to work independently?
I wonder if they are really selling those for this much. Perhaps this is just asking price. If so it seems pretty stupid...
2018 430i Gran Coupe
It basically boils down to this. I would like to reduce CO2 emissions for community interests and conserve gasoline, however, I"M not going to pay to do it. The AUTOMOBILE companies need to absorb some responsibility also.
I'm not trying to criticize your thinking here, but what if invoice price on that same car was only $20,000? would $21,000 be a bad deal?
I think this is the attitude of many people and everyone is entitled to their opinions. I don't think it's wrong at all. at the same time, there are people who beleive it's worth the "premium" to buy a hybrid for a number of reasons. Yet those people are constantly criticized for their decisions and supposed math deficiencies. Look, I know that it costs money to buy a hybrid and on a PURE financial POV, a hybrid may not make sence in many circumstances. Could there be other reasons to buy a hybrid?
One of those reasons is a response to the last line of that quote above- that manufacturers need to bear some of the burden. When a manufacture puts money and resources into new technology instead of shareholder dividends, when they spend millions building a new plant, when they basically put their corporate neck out there to introduce a new car, is that not enough? Some people are willing to be early adopters in hybrid technology to support future investment into further developing the technology. Nobody says that YOU (naysayers) have to be an early adopter. But if hybrid technology takes off, and prices come down, you can thank companies like toyota and honda for putting up the research investment and early adopters for funding part of it. So instead of everyone pooping on hybrid buyers, why not thank them so that one day hybrids may be cheap enough for you to afford.
Aside from what we do with the burned out batteries - hybrids on the road don't hurt us, I agree. But I'm not at all convinced that hybrids are going to be anymore popular than an Oldsmobile Diesel 10 years from now, because they don't save you nearly enough gas to pay for the added expense up front, unless you drive about 200,000 miles a year. When are 2 engines in your car better than one? I'm not convinced ever, when compared to a Corolla.
Railroadjames(Hummers "R" Dummers and PRIUS FREE-US) :shades:
Railroadjames (Want World Peace...Use Yer Turn-Signal) :shades:
P.S. As to additional cost of a hybrid sys., look at it as an investment in a higher resale value. Why wouldn't be there? What do you suppose the resale value is doing with Hummers, Escalades, Excursions and the like? I see 'em lined up all over the place with 4/sale signs collecting dust or going for rockbottom $$$. Two yrs ago I took the plunge, not knowing if I was going to regret my decision. Guess what? I hit the lottery. My Prius is and has been a bonanza. Just occasionally pulling into stations with fill-ups running around20-24 Dollars while the above mentioned guzzlers kill a "C-Note." I smile and they try to ignore me while spending 5 times the minutes still dumping fuel in their behemuths. Isn't it time for hybrids or the like?
Ok, so the issue you have with pricing is not with toyota or whether you can recoup the hybrid premium or if the car is worth the price for the features you get. Rather the issue is with the car dealer overcharging for a car. I can understand this. Sometimes I specifically go to another vendor of a product (or don't buy at all) so that a particular vendor doesn't make money off of me- it's called the freedom to let your wallet speak and that certainly applies in your case.
Unfortunately, a prius doesn't fall into the same catagory as a lot of traditional cars. it's not the dealers keeping prius prices up, it's the consumers for the most part willing to outbid the next guy to get a car. I'm sure you already realize that you won't get your price point until demand or supply changes dramatically and this may take years which you already said you were prepared to wait.
You are right. Many dealers have already shown their willingness to lower the price of hybrids when the car sits on the lot a few days. If the reports are accurate, Toyota is ramping up the production of the Prius. People should have a chance to buy without all the frenzy that is now surrounding these cars. I totally agree with sr45, I will not pay MSRP or even close for a car. Any thing over invoice is money down the toilet when you go to sell. In 41 years of new car buying I have always been able to get the dealer close to invoice or below. It can be done. You just have to make them understand, that they are not the only dealer with new cars to sell.
Check the Rules Of The Road and govern your behavior accordingly.
Bingo! If consumers are stampeding in a delirious rush to pay over MSRP to make a social statement, why shouldn't car dealers laugh all the way to the bank? Streetwise economic theory: "If ya' wanna play, ya' hafta pay."
Railroadjames
Put it this way--I personally would be hesitant to buy a hybrid still running on the original batteries and w/ an expired or near-expiring battery warranty...especially if the seller hasn't taken such into account when determining the selling price of said vehicle. Hybrid batteries may very well last 150K miles, but I seriously doubt that when they eventually do need to be replaced, the replacement cost won't be cheap...that's for sure.
"you'd be taking public transportation."
Trouble is in most places it doesn't exist. A mass transit system is pretty low on the governments priority list.
And actually you are right they current :hybrids "don't save you money". If you look at TCO there are much cheaper transportation alternatives, even in places where mass transit doesn't exist.
Then if for some unknown reason, you want to pay more than MSRP for a hybrid you exacerbate the situation.
YMMV,
MidCow
If hybrids are worth their "weight in gold" to the point where many of these hybrid owners continually spew numbers about how much money they're saving...why would there be a need for tax breaks/credits on hybrid purchases? With all the money hybrid owners are supposedly saving from not having to spend as much money on gas...isn't that enough of a financial incentive to buy one? Apparently, some folks don't think so...hence the enticing tax breaks/credits... :lemon:
Okay thanks for explaining you statement more. I am in total agreement with you !
Have a Good Day,
MidCow
I can answer that question Alex.....:D
The reason for the tax breaks is that in general, "money talks and BS walks." People in general (the US Public) is not educated enough about hybrids (do you have to plug them in? Can you drive 300 miles? Can it go the speed limit?) to know what an awesome technology they are.
That is partly the car manufacturer's fault for not getting the information out there. One good ad campaign, expenses shared by Toyota and Honda, executed 5 years ago would have done wonders for that problem.
Another problem is that until just recently (2003) the available Hybrids were, to be kind, a little quirky and small and underpowered and very "niche" (speaking of the Insight and the original Prius.) Those cars did nothing to grab the public's attention, as they were stuck in the throes of the "Bigger, Heavier SUV to keep up with the Joneses" phase of car buying.
Another MAJOR problem is that virtually every news story you see keeps harping on "they don't pay for themselves" or "They dont get advertised MPG." Until enough people like myself and other Hybrid advocates get the CORRECT information out there to the maintstream media, that crap is going to continue to be a deterrent to sales.
Now, with gas prices up and people realizing the truth about smaller cars and how much their pocketbooks can be spared that $80 fillup, smaller cars and hybrids are making a move. Expect about 210,000 to be sold this year, as opposed to about 80,000 last year.
I can answer that question Alex....."
I have to disagree. The tax credits are there because the politicians also don't understand the technology, and the fact that it was already selling quite well without incentives. They were attempting to get the auto manufacturors to make more hybrids, but what they should have done was applied the credits only to new models produced by manufacturors. That would have spurred the big 3 to put out the hybrids. Toyota and Honda didn't need any prodding to produce hybrids. Not only that, but it immediately rewards the two hybrid companies, who are building their bread-and-butter hybrids in Japan, rather than encouraging more jobs in this country. At the very least they could have stipulated US built vehicles...
Just a wast of taxpayer money, but then that is what politician$ are good at.
That being said:
The Hybrid tax incentive program is NOT one of the bad ones.
What it does is encourage purchase of CLEAN, highly efficient cars which in the end put fewer exhaust toxins in the air, reduce foreign fuel dependency, and reduce greenhouse gas emissions.
In addition, the more hybrids sold, the better the future technology will be, allowing for CLEANER cars and higher MPG, as evidenced by the 2006 HCH, which is an AT-PZEV car, the cleanest gasoline engine rating that can be given by the EPA, and which has also increased HP by 20% and fuel efficiency by 5% over the first generation HCH. That's progress, and part of that was paid for by encouraging more hybrids to be sold.
What do you think the next generation Prius might be rated? 65 MPG City, 55 Hwy probably, and will run on battery longer at probably at higher speeds. This is what the purchase of today's hybrids will bring us - better hybrids in the future.
I can't see one bad thing about any of that.
You know how much it would cost to make EVERY CAR a PZEV car, from the factory? About $100-$140 per car. That's it. You'd think that the govt could FORCE the car companies to do that, but the Auto Lobby is too strong. Why, that would take BILLIONS of dollars out of the stockholder's pockets, good Lord, we can't do that !! (OMG)
And the "clean diesels" that get high mileage are not "really clean" until the ULSD fuel becomes entrenched in the USA and the particulate filters are prevalent to remove the remaining soot from the exhaust. Again, incentivizing them only helps in the mileage side, not the clean air side.
Incentives for the high MPG Hybrids helps in both GHG and in fuel conservation - a double whammy for the money. That's why it's the right thing to do.
The incentives are also available for some low mileage SUVs. I agree that picking on one technology because it is the fad of the month is not good. Notice how they eliminated the diesel cars? They knew none would pass the emissions with the crappy diesel in many parts of the US. Time will tell if they get a shot after ULSD is mandated Sept. 2006. Mercedes & Ford have demonstrated PZEV Diesels using good fuel.
I think we can all agree that Hybrids have moved far beyond "FAD" stage and are on their way to complete mainstream stardom. Notice as evidence recent comments by Ford who is going to have almost all their cars with a hybrid option by 2010, and Toyota's statement two years ago (repeated many times) that they would do that, and all the other makers who are putting hybrids on the road in the next 2-3 years. Notice the estimated 200,000 hybrids to be sold in the USA in 2005. Notice Honda into the second generation of the HCH. Notice recent Frankfurt car shows with multiple Hybrid concepts. Notice even VW saying they would make a hybrid, after poo-pooing them for years now. Notice Nissan with an Altima soon.