Spend 25K to save 7.6K

Math Is Hard!

Chevy Volt:

You’re not saving any money whatsoever – at $46,000, the difference between the Volt and a Civic/Corolla/Sentra/any other comparably sized gasoline engine car in gas mileage is negligible. Even with gas at $4 a gallon and and an annual commute of 20,000 miles, the gasoline-only car getting 25 MPG would cost you $3200 for the year. Even if the Volt were 100% free, it would still take almost 10 years of driving to offset the cost differential.

There will always be people who spend the extra to feel good about what they’re doing to save the earth or whatever, but until these things become reasonable in a way that can be substantiated by mathematics, they’re not going to go mainstream.

I previously wrote When it’s financially better than the alternatives it will catch on…and not until and If people wanted cars with great mileage, they’d be buying them about this issue.

I hope we keep making headway on alternative fuels and hybrids and Mr. Fusion, but a lot of people seem to ignore reality when they push some of this stuff.

Comments

  1. Forget the Volt. Most of the diesel VW’s aren’t worth couple thousand cost differential with their gas versions. I’ve run the numbers. The mileage savings aren’t realized for years even without a time-value of money calculation.

    I am trying to convince my father to check out the BMW 335d. I want to see what 425 pound-feet of torque feels like in a little sedan.

  2. That’s why I’m a big fan of the Mazda approach – make a car lighter and bring the internal combustion engine into the 21st century (direct injection and crazy-high compression ratios). You get a <$20k car that's more fun to drive and gets 40 MPG.

  3. Same propaganda applies to “home roof-top” wind turbines.

    An article in the October, 2011 Popular Science Magazine, pertaining to a Honeywell rooftop wind turbine, caught my attention. I am not a proponent of wind power so I thought I would do a little investigation into the article statements.

    The article stated that the total cost of the wind turbine, including installation, was about $10,000 and that it can produce up to 1,500 kilowatt-hours (KWH) per year.

    The average price I paid for electricity in 2010 was about 12 cents per KWH. My annual savings would be (0.12 $/KWH)(1,500 KWH) = $180.00 per year.

    $10,000.00 ÷ $180.00 per year = 55.55 years to pay back my investment. This does not include annual maintenance costs.

    How many kilowatt hours per year will this machine put out at your location? The power in the wind varies with the cube of the wind velocity. A color coded wind speed map can be found at: http://www.windpoweringamerica.gov/images/windmaps/tx_80m.jpg

    In my home town of Bay City, Texas, the average wind velocity is about 7 miles per hour. If this wind turbine was able to extract all of the available power (not possible) from the wind, it would produce 0.029 kilowatts, or 29 watts. The annual energy produced would be (0.029 kilowatts)(24 hours/day)(365 days/year) = 254 KWH. My annual savings would be (0.12 $/KWH)(254 KWH) = $30.48 per year. The time to pay back my investment is $10,000.00 ÷ $50.46 per year = 328 years. This does not include any maintenance costs. The Honeywell wind turbine has a 5 year warranty.

  4. I recently purchased a 2012 Ford Focus with a 6 spd auto in it. I only put about 22 to 2300 miles on it (I’m enroute back to the Sandbox), but I averaged 31.2 mpg with it over the course of those miles. Very good car, well built, and fun to drive bopping around rural MI. Didn’t check it’s highway mileage, but most in the forums are reporting 36-40 mpg (with my average mpg I’m thinking 36-37 highway mpg is fairly likely). Looking forward to getting back and driving it again!

    1. One of the cars on my current shortlist for Next Car is a Focus. It will depend on what my driving requirements are when I can finally pull the trigger on that.

      Right now I’m still tooling along in a rusty 1998 Chevy Cavalier 5-speed. Looks like crap and is long in the tooth, but been paid off for years, runs fine, and gets 30+ mpg. Hard to justify spending money to replace it.

  5. I am taking the cheapest route. The Bus. (the MINI had too many maintenance costs)

    @Toejam
    Windpower, macro and micro, is getting better; however the best home-energy thing I have come across is solar-hot-water-heaters to augment one’s existing hot water heater. Only energy efficiency improvements have proven better. Also one does not always have to calculate ROI for everything one buys; the peace of mind of a stable independent energy supply can be priceless.

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