Choosing Hybrid/PHEV over Standard Petrol Car. Is It Worth The Premium?

Hi all,

Almost every car brands are offering sort form of electrification of their lineups nowadays and I'm trying to understand the pros and cons. The hybrid or PHEV version specifically almost always come at a premium price. Just an FYI this doesn't include full EV as I believe the differences comparing to regular cars are quite significant. (i.e. handling, charging stations, range…etc)

The number one argument I often see in car reviews or forums that's against buying a hybrid/PHEV is that "It'll take years to cover the cost premium since the fuel savings aren't that great. Unless you travel lots of kms each year, it's not worth it".

I'm baffled by this argument. My question is: since you're already paying a premium when you purchase the car. Assuming both cars depreciate at the same rate, wouldn't you technically be able to sell it at a higher price too, if you were to sell it say after 5 - 7 years? Therefore the fuel savings that you receive are actually the additional benefit for driving a more fuel efficient car? Even if you weren't going to sell it and want to drive it to the ground, over extremely long period you should also be able to recover the cost of the premium?

I've found that there are no significant price difference between servicing a standard petrol/diesel engine car compare to hybrid/PHEV cars.

The only other con that I can think of is: when there are more parts in the car, there's always a higher probability of something goes wrong or fail which is fair enough. I also notice that the regenerative braking in some of these hybrid cars can feel a bit jerky at times and therefore are not as smooth.

What are the other pros or cons that people can think of? Given that heaps of new cars coming in 2021 are gonna be electrified I hope this will be a useful discussion for many new potential car buyers.

Thanks for everyone's input in advance. Cheers!

Comments

      • the environment benefits… something that nobody seems to care about

        • How does the environment benefit from subsidies that car manufacturers overseas get, rather than spending the money here on local research?

          Whooah, yes exactly, so you propose replacing one stupid tax/incentive with another? Thats exactly why they don’t work.

          • @RockyRaccoon: you're saying that incentives don't change spending??? okay.

            • @Mr Haj: Of course they do, it’s just that subsidising something that will happen anyway is plain stupid.

              Europe China and the US are all falling over backwards to improve this technology. What impact will a few extra car sales in Australia do?

              Nothing, we just wait, spend our money developing other environment solutions to benefit the planet, and we all benefit rather than a few select overseas car CEO’s

        • The urban environment benefits, but the raw materials still have the same terrible impact on the environment. Especially cobalt mining.

          • @blank-404: Nothing wrong with improving the urban environment, less oil leaking onto the roads and inevitably into our waterways and less diesel particulates in our lungs causing disease.

            • @Stimps: Never said it want a worthy pursuit, but to blanket 'the environment benefits' as the reason is a fallacy. The child labour in the Congo definitely won't.
              The pollution from making a vehicle remains the same, then there's the pollution from what you charge with (coal, gas, mining for photovoltaic cell elements).

  • Cost of ownership explained well in this video.
    To make it cost effective based on fuel usage/savings alone, you'd have to drive 350,000km to break even. So about 23 years of "average" driving.
    What you may deduct initially from the extra ICE servicing requirements will be taken later down the track in battery or motor maintenance/replacement.

    • If it's on YouTube it must be true

      • John Cadogan is quite biased since his business is buying and selling second-hand petrol/diesel cars, but he does make a good argument on many of his videos. I'd like to see him face off with his opponents, eg. guys from electrek.co

        • you have confused used with new cars, his company is in the new car business.
          But what does that have to do with the facts of maths and engineering?

    • His comparison is based on paying $25,000 more for the EV vs ICE version of the Hyundai Kona, petrol at $1.26/l and electricity at $0.26/KWh, it would be a different equation if you have enough solar panels to generate a net power excess. You should factor in the life cycle costs of ownership — servicing, battery replacement, etc. Overall a hybrid will have higher costs than an EV or ICE vehicle.

  • When we bought our first hybrid vehicle, it was never sold to us as cost effective. The salesman even made a point that it was probably going to be more expensive in the long term. But, we have continued to buy hybrid vehicles because: (1) Comfort. This is the main one. No vibration or noise at vehicle stop; no delay on starting from a full stop like an auto-engine-off petrol-only vehicle; smooth acceleration without feeling any gear changes (CVT); no problems with smooth braking, just get used to it like when you first learned to drive & brake. (2) Less Co2 emissions (but note that overall environmental advantages are controversial), especially in carpark situations. (3) Range between fuel fill ups. I'm getting 950km in city driving between fuel ups in a sedan.

    • Comfort. This is the main one. No vibration…

      Show me a new car in the same price bracket that vibrates. What a load of rubbish.

      • I own a Mitsubishi Outlander (non-PHEV) and the wife owns a Corolla Hybrid and I can assure you, her car is a lot smoother than mine. A lot. The Corolla is dead at the lights. The first few times I drove it it was hard to tell it was even turned on. I have gotten out of the Corolla and forgot to turn it off because there is nothing. No humming, no vibrating, no idling, no sound. Like it is already off. The Outlander does all of these things when it is stopped with the engine running, you definitely know it is running.

        Both cars were around the same price to buy.

        • But the sensation in the Outlander compared to the Corolla is not uncomfortable. Just different.

          • @MS Paint: Oh, I agree… it’s not uncomfortable… but if you spend all your time in a hybrid and go back to standard ICE, it would be a weird experience, much like it is every time I drive the Corolla.

            The only thing I don’t like about the Corolla (and most hybrids) is that they are so quiet, that when the engine does start up at slow speeds or when stopped, it sounds like the air compressor starting up in the garage randomly.

      • Show me a new car in the same price bracket that vibrates. What a load of rubbish.

        You didn't quote my whole sentence. I said at vehicle stop. No vibration, no noise, nothing. You could be dead of night in your garage, and there's nothing. This is noticeable at every stop, traffic light, stop signs, traffic jams, etc. I drive hybrids 95% of the time & petrol about 5% of the time. It's quite jarring when I'm in the petrol vehicle. You really get used to the no-engine-at-stop feel. I'd imagine the full EV people would feel the same.

        • You didn't quote my whole sentence.

          The … at the end of my quote represents a truncation.

      • Some people might consider a vibrating car a feature.

  • wouldn't you technically be able to sell it at a higher price too, if you were to sell it say after 5 - 7 years?

    This is still an unknown. Second hand buyers face the prospect of battery replacement in the short term therefore likely driving prices down.

    • I've noticed that EVs suffer from significant price depreciation because the technology is improving so fast. You can buy a 2013 Nissan Leaf for $15,000 with only 43,000 kms on the odometer, whereas a 2020 model can be purchased for $45,000. The 2013 leaf only has 120km of range, while the current model has 270km range.

      • Of course, thats why we should wait.

        The technology is improving, and will do so even without us needing to subsidise the car manufacturer.

        We never subsidised the Leaf, and look already it has twice the range

      • That's because the battery has no active cooling function, overheats, and you will be likely to get 20km range.
        Then you can spend $10k on a replacement battery, yay Nissan engineering.

    • Exactly, thats why Taxi owners buy 2 year old Camry hybrids from Government fleets, far cheaper.

  • I didn’t see mention of driving conditions when comparing. It is way less cost effective if you drive country kms in a hybrid. Their main advantage is I. Collecting energy when you slow down and then using it to accelerate you.

    Stop start traffic will have a bigger effect on fuel use in a hybrid.

    IMO a plug in hybrid is a better option … as long as you actually plug it in to recharge. In the UK it has been found that many drivers don’t plug in their PHEV models and don’t gain the energy efficiency they should.

  • Sadly no hybrid Honda Odyssey in Australia, best hybrid combination.

  • +3 votes

    We got the rav4 hybrid. I don't know why you'd pick the Petrol unless buying the Edge (off-road) model, or the absolute cheapest. The hybrid wasn't a big premium, massively reduces fuel consumption for metro driving which is most of it's use, is more powerful, adds AWD, and nicer to drive. The market felt similar hence the wait list that formed to buy the hybrid, while the regular cars were sitting in lots.

    I don't think that applies to all cars though. We looked at the Subaru Forester and I wouldn't have bought the hybrid. It was something like a $5000 premium to be 10% more efficient, with a smaller less powerful engine and worse at offroading.

    • it still takes around ten years for the petrol savings to break even, and you would have extra servcing costs.

      Would not buy it for cost savings, but more the features/ eco stuff

      • Not necessarily - using Camrys as an example (they are the most common "non-Prius" Toyota hybrid):

        The cheapest petrol 50 series Camry on carsales is listed at $9,500 with 245k on it.
        The cheapest (non-ex-taxi) 50 series Camry Hybrid is $12,950 with 171,500km and a higher spec (leather, etc.)

        There's a $3k difference - roughly the difference when new (for the RAV4 is it $3k).

        So the only "cost" for the hybrid is the time value of money, as the higher purchase price is reflected in the higher resale. The hybrid is also cheaper to register in some states (Qld, Vic until 1/7/21).

        There actually isn't any additional costs in maintenance on the Toyota hybrids - only an annual battery check to keep the 10 year warranty (which you don't have to do if you are happy to lose the 10 year warranty).

  • My partner has a RAV4 Hybrid. One of its main selling points for me was its performance. It's quite quick for a SUV in its pricerange (0-100 in around 8 seconds) and it's also very torquey (a by-product of the electric engine). To be perfectly honest, even if the fuel consumption was line ball with the regular 2.0 engine, I'd still buy the Hybrid just for the additional performance. The only other SUV that rivalled it was the turbo CX-5, but that came with a fuel impost, and given my partner has a reasonable commute (75 km return daily), the significantly reduced fuel consumption of the hybrid was welcomed.

    • We went to gold coast last week and rental car was Rav4 Hybrid. Very torquey and very nice to drive. We drove around 400 kms, with car consuming just 21 Litres of fuel. My next car would definitely be hybrid.

    • RAV4 hybird was exactly what I'm thinking of. If we were to put aside the handling & performance aside, since you're paying more for the hybrid version compare to the ICE RAV4, it should also worth more when it comes to selling second hand if they both depreciate at the same rate?

      It's also a bonus that its hybrid engine drives smoother and performs better than its regular version. Some other cars however aren't providing those benefits though (i.e. Subaru e-boxer).

  • Hybrids likes Prius will deprecate as much or more than ICE. Reason its the battery, its an expensive replacement part, life is about 7-10 years. Personally I dont see the value in them. Want to save money just buy a cheap small displacement hatch.

    Fuel saving is marginal compared to a efficient modern small displacement turbo engine, 1-2L/100km better than a cheap ICE car.

  • It's interesting that people do focus purely on fuel savings, and just appear to look at the numbers as they sit.

    A few points from someone who's had to talk a lot about these engines over recent years:

    • Performance - On maybe half the cars that have a hybrid option, there's more performance from the hybrid engine than the petrol. Look at RAV4 for instance, it's the choice between ICE 2.0L or a hybrid 2.5L. Trust me, the 2.5L hybrid shits all over the 2.0L. Same with Camry, the hybrid 2.5L drives far nicer than the standard 2.5L. Corolla goes the other way, in that the 2.0L has more power, though the hybrid 1.8L is a better drive than the previous Corolla 1.8L models.
    • Value for money - On Toyotas, as an example, hybrid will only cost you $2,000-$3,000 more. We're not talking massive amounts relative to purchase price. Yes, you could do the sums on a purely quantitative measure (see point 1 for why you shouldn't), but for that price you're sometimes getting more features. Things like keyless entry/start & climate control on entry-level cars, included in the hybrid.
    • Maintenance - Sure, they hybrid battery has a life-span, but now with 10yr warranties, and a replacement cost of approx $3,500 right now (let alone in 10yrs), it's not crazy. How many people used to pay $1,500 or so for timing belt services every 100,000kms? The hybrid battery could last you 15-20yrs, which would likely be the life of the car anyway. Not to mention, who knows what businesses could come along in that time (aftermarket batteries, or some way to recon them?), bringing that cost down. And the electric motors are designed never to be touched, never adding to your servicing costs.

    Don't get me wrong, pure EV etc is the next step, but for them you're definitely paying early adopter tax right now, so hybrid is a good solution until those are more viable.

  • anecdotally -
    - I bought my first car, a 2007 Prius in 2011. It is still going strong. I bought it from Pickles Auctions as a fleet car and it already had ~180k's on it. This car never missed a beat. Battery degredation was never an issue. Also note that a replacement battery from toyota runs you about $5k (about 2.5k aftermarket).
    - My Prius is now at the 260k mark and still going alright. I've since passed the car on to my old man as I wanted something with bluetooth.

    My personal advice is, wait until covid is over, so 2nd hand prices fall back down, and buy a 2nd hand hybrid. As shown in this thread, there's a lot of fears about battery longevity. Use it to your advantage and get a decent 2nd hand hybrid for cheap.

    FYI I got my 2007 prius for ~9k at auction - I rekon is a was a great deal for how long it lasted me, and how good it was as my first car (as compared to say… an ICE yaris).