Official: Toyota sells six of 10 of hybrids in California



I'm just saying, why discuss at length how some sub-decision is financially unsound when the main decision that generates the discussion is financially unsound.
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wrote:

You are saying it is stupid to buy a new car because it is financially unsound. I'm saying it is stupid to buy a hybrid for the finances because they don't work out.
REALITY CHECK It's the same thing. Do not buy a hybrid to save money because you will not UNLESS you do the things that makes it a good decision to buy a new car in the first place.
If one has a short ownership window, then a new car is a bad buy. If one has a short ownership window, then a hybrid is a bad buy -- argueably even worse than buying other kinds of cars and not keeping them very long.
Buy a new car if you want, but the economics of a hybrid do not work out unless the ownership window is very large. That's what I'm saying.
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You have to start with the stupidity of buying a new car before you can even begin to investigate any sub-issues, like "hybrid or not?".
Once you've started down the path of "I'm throwing gobs of money away," any discussion of "should I also throw this nickel away too?" is ridiculous.
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wrote:

Buying a new Toyota is NOT throwing money away, as long as one keeps it for a LONG time. I buy my vehicles new--current Toyota is 99 Camry, BOUGHT NEW.
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Right!! I bought my new 2004 Sienna in Sept 03 and still have it. It will be 10 years old next month and I have no plan to sell or trade it. It still runs and rides like it came off the showroom floor ten years ago.
--




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On 8/6/2013 8:12 PM, Elmo P. Shagnasty wrote:

Not at all. Buying a new Toyota is usually smarter than buying a used Toyota when you consider the cost per year, the warranty, the resale value, and the depreciation. One thing that _sometimes_ makes sense is a Toyota Certified Used Car which has a 7 year/100K mile warranty included, provided the deal you get is a good one. If you buy a used car from a private party you can't get this warranty though you can still buy a Toyota extended warranty.
Hybrid versus non-hybrid is totally a separate issue. Hybrids are mostly purchased on emotion since only a tiny percentage of purchasers will ever make up the extra initial cost and the higher maintenance costs with savings on fuel.
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On 8/6/2013 3:47 AM, Elmo P. Shagnasty wrote:

I would say, why discuss "the main decision" when it actually is based on totally false premise?
Wouldn't it be better to base the discussion on the reality of how long a new car buyer keeps their car rather than using "3.5 years?" In fact a hybrid may make more financial sense using the actual six year average that a new car buyer keeps their vehicle. Actually it almost never makes financial sense with fuel at $4 per gallon, since the break-even point for a similar size and quality non-hybrid is around 175,000 miles, but it makes less bad financial sense the longer you keep the hybrid.
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wrote:

It's not the cost of a gallon of gas that makes it cost effective to go hybrid or not. It's the _difference_ in the cost per mile of going hybrid vs. staying with gas-only, then dividing that difference into the cost of the hybrid package.
If gas costs $4.00 per gallon or $3.per gallon or $5.00 per gallon, your cost per mile is the cost of gas divided by the mileage you get. If you get 30mpg, then your cost per mile is $0.133, $0.10 or $0.166, respectively, but if you get 35mpg then your cost per mile is $0.114, $0.085, $0.142, respectively. It does not matter what the car is, the cost per mile is the cost of a gallon divided by the miles it will take you. If you get 30mpg in a non-hybrid and 35mpg in the same car but with a hybrid power plant, then your cost savings is the difference you realize in the 5mpg that you gain
The savings is the difference in $4 divided by 30 or $4 divided by 35, or whatever the mileage is. As the price of gas goes up, the savings in the cost per mile also goes up, so in this respect the price of a gallon is important.
At $4 per gallon and 30mpg, the cost per mile is 0.133 (13.3 cents), but at 35mpg the cost per mile is 0.114 (11.4 cents). The savings is 1.9 cents per mile. This is the base number to determine how many miles one must travel to pay for the cost of having a hybrid. I do not know what a hybrid costs relative to non-hybrid, but for the sake of simplicity, let's just say the hybrid package costs $5,000 more than the same car in non-hybrid trim. If this is true, then 5000 divided by $0.019 equals 263,158.
That's MILES.
One must (in this example) drive the car more than 263,000 miles JUST TO BREAK EVEN. I'll be the first to admit that my numbers are not an accurate depiction of what the costs truly are, but the math is right even if the numbers used are not. Make the adjustments as needed, but at the end of the day the cost per mile is the price of a gallon divided by the mileage it gives. One must make an assumtion as to the cost per mile of the non-hybrid, then subtract one cost per mile from the other to find the difference. Then one must divide the cost of the hybrid package by the difference in the cost per mile to get the miles needed to break even on the hybrid package.
I am sure the numbers I pulled out of my ass are not accurate because I do not think it takes anywhere near 263,000+ miles to repay the cost of going hybrid, but I stand by the math used. I agree with sms, the miles to drive should be much closer to 175,000, and not very much lower than 150,000.
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On 8/4/2013 4:31 AM, Elmo P. Shagnasty wrote:

You're incorrectly claiming that people are making the decision to buy a new car purely on emotion.
The fact is that for certain makes of vehicles it doesn't make a lot of sense to buy them used. If a vehicle has terrible resale value then a used one can make financial sense (though the reason for the terrible resale value might be worth investigating). If a vehicle has very high resale value then a used one often makes no sense. You get less of a warranty, less overall service life, and often save very little, if anything in the original price.
New car buyers are keeping their new vehicles an average of six years. Let's assume that they don't want to keep a vehicle that's more than six years old. So they can buy a three year old vehicle every three years, or a new vehicle every six years. It's after six years when a lot of wear items on a new vehicle need to be replaced, such as brakes, tires, batteries, CV boots, shocks, struts, timing belts, etc..
Good article about this here: <http://editorial.autos.msn.com/listarticle.aspx?cp-documentid 82223>: "The added cost for CPO models, coupled with higher financing rates compared with new cars, can sometimes push their price close to that of an equivalent new model — or in some cases, even beyond."
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By and large, that's what drives the "buy a new car every 3 years" decision.

That was not the premise.
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On 8/3/2013 12:49 PM, Elmo P. Shagnasty wrote:

The first half of that is demonstrably false for Toyotas. The resale value of Toyotas is so high, and new ones are so heavily discounted off of MSRP, that it rarely makes financial sense to buy a used Toyota. In fact it's not unusual find year-old Toyotas being sold for more than new ones to naive buyers. Just went through that with a relative a few months ago. There's a huge difference between the street price that a savvy buyer pays and the MSRP. Yet there are enough naive buyers that believe that the new vehicle's MSRP is the price they must pay that they overpay for used ones.
In July, Toyota once again stated that they want to reign in discounting. “We will not simply go after volume,” Ozawa told reporters at a briefing in Japan. “We are going to restrain discounts and incentives.” I wonder if they are really serious. To reign in discounting will mean large drops in volume, and Toyota historically has liked to keep its factories operating at full capacity and unload that capacity by discounting. It's amazing to me that we paid slightly under $17K for a 1996 Camry LE. 17 years later, the street price of a 2013 Camry is slightly under $19K. A $2K increase over 17 years, but the 2013 is larger, more powerful, has better fuel economy, and much more standard equipment. Whether the current generation lasts as long is the key question. Sitting in the new Camry you feel like you're in a luxury car like a Lexus.
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I never discussed particular brands.
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and, frankly, is a piece of shit to sit in and drive.
Have you actually done that?
What Toyota have done is to push the old Camry experience on up to the Avalon.
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On 8/5/2013 2:49 AM, Elmo P. Shagnasty wrote:

Of course. I helped my sister-in-law buy one earlier this year. A wonderful vehicle. You almost feel like you're driving a Lexus. I was a little concerned because after the third generation Camry, Toyota did some decontenting on the fourth generation. But the seventh generation they apparently realized that they had to undo the decontenting. As Car and Driver wrote: "More luxury and more mpg for America's most popular car." The styling is pretty bland though. I think the Accord has better styling, but we (my family and extended family) are done with buying Hondas because they lack the long-term reliability of Toyotas.
No offense, but the Prius feels very utilitarian. It's fine for a daily commute car, but you would not want to take any long trips with four full-size humans and their luggage.
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No doubt there was *some* premium on it for being hybrid, but that was offset by the fact that we know and trust the original owners, and know how they cared for it.
THAT'S something that's worth paying a premium for, and ignoring whether it's a hybrid Civic or a non-hybrid Civic.
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On 8/3/2013 5:59 AM, Elmo P. Shagnasty wrote:

The average age of vehicles in the U.S. continues to increase, now it's at about 11 years. That doesn't mean that the original owner kept it for 11 years though. In 2011, an R.L. Polk study showed that Americans were keeping their new vehicles an average of 71.4 months, that's nearly six years.
Using "3.5" years is not insane, it's dishonest. I know it wasn't you that stated the "3.5" figure, but you should be careful about believing what some people say in their posts in their effort to "prove" something.
<https://www.polk.com/company/news/polk_in_the_news_americans_are_keeping_new_vehicles_an_average_six_years
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Of course they can. But what's the point? Why tell someone who has already gone down the path of making a bad financial decision how some small detail of this bad decision can be slightly changed to make it a very slightly less bad financial decision?
Once you've gone down the bad road, it really doesn't matter whether you drive on the right side or the left side.
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On Friday, August 2, 2013 3:08:58 PM UTC-5, Jeff Strickland wrote:

I'm fairly convinced that a hybrid will cost more over the long haul for someone like me that keeps a car until it's almost rotting away. They cost more initially. The drink less gas, but how much that matters will depend on how much driving you do. When the hybrid gets old and parts start flaking out, it will probably cost so much to repair as to render the vehicle as disposable. More to go wrong and break even when young.
I considered one when I bought the Corolla, but I didn't want any part of it. It was a hybrid Civic for $1000 more than I paid for the Corolla. Too scary after the miles start piling up. It's bad enough with just an aluminum conventional engine. IE: don't let one overheat or it's toast. I don't want to see a replacement battery in my future that costs more than the car is worth. And for the greenies, you have to consider the materials and making of the batteries as far as the big picture.
Myself, I'd rather have a high mpg conventional engine. I get 43 mpg at 65 mph with the cheap easier to fix Corolla. It's not in the 50's, but still not bad.
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The question is, if there are two of the same make and model cars, a Corolla or Camry or Civic or Accord for example, that are available in gasoline only and hybrid trims, how much more does the hybrid cost?
If the gasoline Corolla costs $17,500 and the hybrid Corolla costs $22,500, then the premium for hybrid is $5,000. I don't know what the cars sell for, but if one is looking at one of these models then he will know what the selling price is, and the difference in the gasoline model and the hybrid model is the number to know.
The next number to know is the cost per mile to drive, specifically the difference in the cost per mile. If you are driving a gasoline car for 1,000 miles for $120, then your cost per mile is $0.12. If the same distance in a hybrid can be covered for $100, then the cost per mile is $0.10. The savings is $0.02.
Divide the premium ($5,000) by the savings per mile ($0.02) and the result is that this example must go 250,000 miles before the savings in per-mile operating costs will cover the price of the premium. I pulled numbers out of my ass to illustrate the math, but if one has the actual numbers and does the same math, the result ought not be very much different than my wild guess.
The point is, you need to know what is saved and how much the package costs that gives the savings. Once you know these two numbers, you can calculate what the period is for the savings to repay the premium. If the period is greater than your expected ownership term, you are not saving anything.
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On 8/2/2013 10:33 AM, marco wrote:

Almost no one buys a hybrid believing that the additional initial expense will ever be offset by fuel savings (if they do believe this then they either drive a tremendous number of miles per year, or they are bad at math). At $4/gallon, the break-even mileage of a Prius versus a Corolla is about 175000 miles.
People buy hybrids because they believe that it's a good idea to use less fuel and emit fewer pollutants.
The success of the Prius is largely due to GM. The extremely low quality of the 1978 to 1985 Oldsmobile diesel powered vehicles caused Americans to eschew diesel powered cars. If the U.S. had the same diesel vehicles sold in other countries then we could have far better fuel economy without the need for the complex hybrid systems. Instead, we have the misperception that diesel vehicles are slow and dirty.
A VW Passat TDI gets 43mpg highway. A Camry hybrid gets 39mpg highway. The Camry hybrid is enormously more complex.
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