The Bankrate promise
At Bankrate we strive to help you make smarter financial decisions. While we adhere to strict , this post may contain references to products from our partners. Here's an explanation for .
If you are in the market for a new vehicle, you might be thinking about an entirely new approach to driving that involves fewer — or no — trips to the gas station. As more car manufacturers unveil new electric-powered models, drivers are pondering making the switch. Data from the Pew Research Center shows that nearly 40 percent of Americans are at least somewhat likely to consider an electric car the next time they get something new for their garages.
If you are in that crowd, there is a bigger question you’ll need to answer. Should you leave some room for gas or go all-in on electric? Compare the upsides and downsides of hybrid versus electric vehicles before you head to the dealer.
The differences between hybrid and EV
Hybrid cars, plug-in hybrid cars and electric vehicles (EVs) are all designed to help you curb or cut fuel costs. However, there are key differences between them to be aware of.
- Hybrid models can use gasoline or electricity as a power source. They’re equipped with both an electric motor and gasoline engine that work together to operate the vehicle.
- Plug-in hybrid models are similar to hybrid vehicles, but they come with a large rechargeable battery. If you operate the vehicle while the battery is charged up, your gasoline is preserved. But once the battery’s charge is low, the engine is used to and gasoline kicks in so the car can continue to operate, but as a regular hybrid.
- EVs are solely battery operated and only have an electric motor. You won’t find a gas tank or engine inside this vehicle.
How to choose between a hybrid and EV
There is no right or wrong answer when you are choosing between a hybrid versus electric. Instead, you need to think about a wide range of factors, including where you live, what you currently spend on gas, how committed you are to reducing your carbon footprint and more.
“If you don’t want to plan out the miles on your route, you feel as though you have range anxiety or may not have many charge stations around, a plug-in hybrid is a better choice for you,” says Ronald Montoya, senior consumer advice editor at Edmunds.
Start with the U.S. Department of Energy’s plug-in hybrid calculator if you’re considering a specific hybrid model. You can share some information on your driving habits and your home power setup to get an estimate of your annual fuel and electricity costs and estimated number of trips to the gas station.
“If you are OK with planning your routes in terms of mileage and have a charger at home or work,” Montoya says, “you’re the ideal candidate for an all-electric vehicle.” To get a sense of where charging stations are currently located, start with the Electrify America map.
Hybrid benefits and drawbacks
As you analyze the numbers from the plug-in hybrid calculator, here’s a rundown of the major pros and cons of hybrid vehicles.
Consider these advantages when evaluating hybrid vehicles:
- You won’t worry about running out of power. Because hybrid vehicles still allow you to use gas, you will be covered by more than 150,000 gas stations in the country.
- You’ll spend less money each month. While every car has a different price tag, hybrid vehicles tend to have lower payments than all-electric vehicles, which helps keep your transportation costs under control.
There are also some disadvantages to keep in mind:
- You’re still going to spend at the pump. Hybrid vehicles don’t have a long range for operating on electricity, making gasoline the primary power source for longer road trips. For example, the Environmental Protection Agency sets the Toyota RAV4 Hybrid’s electric-only range at 42 miles.
- You’re still going to emit plenty of carbon. Beyond the monthly payment and operating expenses, hybrid cars still take a toll on the environment. “The plug-in hybrid will reduce your fuel consumption,” Montoya says, “but not entirely.” If you’re serious about doing your part to lower your carbon footprint, you should know that a hybrid car’s gas usage will continue to play a role in polluting the planet.
Full electric car benefits and drawbacks
Even ideal candidates will need to weigh the benefits and drawbacks of purchasing a new electric vehicle.
Here are some key benefits you’ll receive by purchasing an electric vehicle:
- You can skip out on paying high gas prices. As of July 25, 2022, the average cost of a gallon of regular gas is $4.36, compared to $3.16 a year ago, according to AAA. With an all-electric vehicle, you don’t need to worry about rising fuel costs.
- You’ll make a positive impact on the planet. As businesses and governments try to figure out how to tackle climate change, individuals can do something about it, too. “If your goal is to completely get off fossil fuels, you’ll want an EV,” Montoya says.
Unfortunately, electric vehicles also come with a few downsides:
- You might need to search for a place to charge your car. If your battery is low, finding a place to charge it isn’t as simple as finding a gas station to refill. “You’ll find that both coasts of the U.S. have the most charge stations,” Montoya says. “It’s when you get into the north-central states like Montana, North Dakota and Wyoming where they become more sparse.” But the future of electric cars looks bright with more charging stations and plans from the federal government to bring down prices.
- You may be waiting a while for each charge to complete. While fast public charging stations are becoming more common, some of the most basic charging stations take a long time to deliver the juice to go far. For example, 120V charging stations offer the ability to go two to five miles for every hour of charging. That is okay if you are charging overnight, but it isn’t convenient if you need a quick fill-up.
- You are going to pay more. All new cars are more expensive right now, but electric cars tend to come with higher sticker prices and higher monthly payments than the gas car you’re used to driving. Your insurance bill may be more, too. A study from financial technology company Self showed that insurance costs for electric cars average more than $400 higher than gas cars.
The bottom line
Whether you decide to buy a hybrid or electric car, you’re going to need plenty of money to buy a new vehicle right now. Since prices are at record highs, it’s even more important to take your time and consider what suits your lifestyle better. You might not want to take too much time, though.
Auto loan rates are projected to increase throughout 2022. So, start by assessing hybrids and electric vehicles to decide which is best for you. It’s equally important to shop around for lenders and compare loan options today to see if you can lock in a competitive deal on financing for your new car.