SUV sales have plummeted since fuel costs have increased. Many SUV owners who are trying to sell or trade their vehicles will suffer huge losses as values decline. SUVs are simply not selling and many dealers really do not want them on their lots. Before you rush to sell or trade your SUV, truck or minivan and buy the most fuel efficient hybrid available, consider these calculations.
For this example, let’s say you drive 12,000 miles per year and gas costs an average of $4.00 per gallon. An SUV will get about 15 mpg and a hybrid will get 46 mpg. Based on fuel costs only, driving the hybrid the same amount of miles per year will reduce your fuel consumption by 539 gallons and save you about $2156. That is pretty good but it may not save you any money at all if your monthly loan payment is going to increase or if you are standing to lose thousands on your trade-in.
You may be able to save more money by analyzing your driving habits and coming up with other creative ways to reduce fuel consumption. Reducing the number of miles you drive by 50 per week or 2600 per year equates to a savings of almost $700. This narrows the savings gap between the hybrid and the SUV to $1432 per year. Granted, this is compared to driving the SUV less than you would drive the hybrid. But, if you did have a hybrid, you may even be compelled to drive more which would also reduce your the total savings for the year.
If you are in a good position to buy a new vehicle, then by all means you should consider a hybrid or one of the other alternative fuel vehicles. The environment will thank you and these vehicles seem to be holding their value. If you are stuck with a gas guzzling SUV or truck though, I think it is wise to look at the whole picture not just the mpg. Think about how much you absolutely have to drive and find out if you will end up still owing money on your auto loan if you trade it in.
When you do buy a new vehicle, the cost of getting those extra mpg’s is something to consider too. For example a small fuel efficient sedan may get 35 mpg and a hybrid may get 46 mpg but the hybrid is a lot more expensive. Will a 10 mpg fuel savings really have an impact if you are paying more for the same size and comparably styled vehicle? You may have to drive a lot to actually reap the benefits of the better fuel efficiency of a hybrid. Maintenance is something else to consider. If you plan to keep your vehicle for three years or more, you may have to replace parts such as batteries in your hybrid. It has been reported that some fully battery replacements can cost over $3000.



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