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Costs of electric and hybrid electric cars
The life cycle costs of electric and hybrid-electric cars can be significantly lower than those of conventional vehicles. Although the cost of electricity to has been estimated as less than one fourth the cost of gasoline (in California in 2007), if a low lifetitme is assumed the lifetime cost of electric and hybrid-electric cars can be higher than IC-powered cars.
This page is currently sourced from questionable resources and needs to be updated with current gasoline costs and projections and with new values for the lifetimes of electric and hybrid-electric cars.
Report by Art Spinella
Art Spinella of CNW Marketing has released reports critical of hybrids, particularly their claim of economic benefits, though this analysis is based on certain doubtful assumptions about the lifespan of hybrids. One widely-released report in 2005, the in-depth Dust-to-Dust study (from production to disposal of a vehicle) found that hybrids fared worse than large SUVs. In particular, a Toyota Prius cost $3.24/mile to build, operate and dispose/recycle, whereas a Chevy Tahoe or GMC Yukon cost $2.93/mile. (For comparison purposes, a Hummer H3 was $2.065/mile, an Audi A6 was $4.96/mile, a Toyota Echo was $.70/mile and a Jeep Wrangler was $.60/mile. Other hybrids were roughly similar to the Prius, the Honda Insight was the best at $2.94/mile). However, these numbers are not without dispute. The CNW report estimated that a Prius cost $354,000 over its lifetime of 109,000 miles, and a Chevy Tahoe cost $787,000 over 268,000 miles and a Ford Excursion cost a whopping $888,000 over 269,000 miles. There are two issues with this - the simpler one being that a Prius may have an average lifespan of much more than 109,000 miles - and in fact the batteries have a 10 year, 150,000 mile warranty. It is a recently introduced car, but several incidental cases of the Prius operating more than 200,000 miles on the original batteries have been reported. Assuming an industry-average lifespan of 178,000 miles, the Prius would then only cost $2.28/mile, beating all large SUVs and full-size pickups.
Claims have been made that the batteries of the Prius have a very short lifespan, resulting in very high environmental impact for the distance traveled. In fact, the batteries have a 10 year, 150,000 mile warranty.
The second issue is the lifetime cost of a vehicle.
A January 2007 analysis by Intellichoice.com calculated that all 22 currently available hybrids would save their owners money over a five year period. The Toyota Prius led the results with a five year cost of ownership 40.3% lower than comparable non-hybrid vehicles. The CNW report reached different conclusions, but with some apparently faulty calculations.
Operating costs are fairly well-known, limited largely to fuel, repairs and maintenance. The initial buyer of the vehicle must pay for the mining, manufacturing, assembly, design and overhead of all components of the vehicle (assuming there is no massive government subsidy common to all industrialized nations). Otherwise the manufacturer or suppliers would be losing large sums of money on each vehicle (many times the price of the vehicle, given the numbers in this report) and quickly go out of business. Since little money changes hands when a car is junked, it is reasonable to assume the disposal of a vehicle is largely paid for by recyclable material (and to some extent, government-subsidized landfills). The CNW report shows large sums of money for each step in the process. Even the cost of transportation of workers to the workplace is covered, although that should be paid by their paycheck. Only government-subsidized road repair seems to be missing in the list of costs (which is affected more by multi-ton vehicles). The large dust-to-dust report does not get into specifics on how double-charging of expenses is avoided (such as steel that is recycled, or workers' costs and their salaries), but a detailed analysis of the whole report is not possible here. Briefly, without the bankruptcy of multiple nations and car manufacturers, the large figures associated with lifetime vehicle costs are highly suspect.
In any case, the less publicized but more recent report for 2006 vehicles (summarizing spreadsheets available only) has adjusted the figures considerably. According to CNW Marketing, hybrids now cost less per mile than large SUVs: the 2006 Prius is reported at $2.87/mile, Chevy Tahoe is $3.76/mile, and Ford Excursion is $4.04/mile. Regardless, until the vehicle lifetime costs can be verified more completely, and considering the inconsistency between claim short lifetime of the battery with the actual warranty period, these reports should be considered with skepticism - though of course some of their analysis may well be valid.
- Check Reason.org's analysis and attempt to give an objective analysis of which cars are more efficient over their life cycle.[Suggested project]
- Do a sensitivity analysis so people can input their own costs and driving habits and make a choice for themselves.
- This report has been discussed also by the libertarian policy institute, the Reason Foundation - a public policy research organization based on "libertarian principles, including individual liberty, free markets, and the rule of law." It is claimed that hybrids have a higher energy cost over their life cycle than normal cars, and even than the enormous Hummer.W This is calculated as dollars per mile. There are many factors, of which a significant one appears to be the assumption that a Hummer will last for three time as long, i.e. 300,000 miles instead of 100,000 miles for a Prius. Have You Hugged a Hummer Today?, Commentary, Reason.org, July 19, 2006
- Prius Yes website (promotional website). Click "Prius Facts" for the statement about the warranty on the batteries.
- "Hybrids Cost-Efficient Over Long Haul", Business Week, January 9, 2007. The summary of the Intellichoice report is based on Wikipedia.
- The material section beginning "Art Spinella," was copied here 26 March 2007, with a note left on the Wikipedia talk page. It was quickly removed, as it contains considerable analysis and original research, which is suitable for Appropedia but not Wikipedia.