Hybrid Vehicle's: Consider your driving habits

Purchase of a hybrid vehicle requires financial, as well as environmental, consideration

January 23, 2011 - I know the environmental benefits of buying a hybrid vehicle, but aren't there also financial benefits to offset their higher cost?

Based on the number of fresh models being introduced this year, the demand for energy-efficient cars appears to be reaching new heights. Hybrids--which are powered alternately by gasoline and battery--have steadily gained traction over the years. And, more recently, cars which are strictly or primarily electric--running on batteries and recharged rather than refueled--are coming to the market.

Given their popularity, perhaps you're wondering if now is the right time for you to invest in a more energy-efficient car. The answer may depend on two factors:

• Your driving habits and the current and anticipated price of gasoline; and

• Your desire to be an "early adopter" and make a personal environmental statement by owning a hybrid or electric vehicle.

As is often the case with innovative technology, electric cars tend to come with a steeper price tag than their gas-powered counterparts. With production occurring on a more limited scale, prices will likely stay higher for electric cars in the near term, just as has been the case for many hybrids. Part of the higher upfront cost may be offset by federal tax credits of as much as $7,500. Beyond that, the financial calculation is based on whether the amount of driving done (and the resulting savings on gas) will overcome the extra upfront cost. {continued}