Study: Hybrids' residuals will trail gasoline versions'

As the number of hybrid vehicles on the market continues to grow, so does the number that will be leased. In order for banks and automaker financing units to determine lease payments they have to estimate what the car will be worth at the end of the lease. A number of analysis firms create listings of estimated residual values for new cars based on what current used models sell for. This year for the first time (subs req'd) the Automotive Lease Guide is estimating three-year residual values on hybrid models.

ALG found that except for the Ford Escape Hybrid all hybrid models that have gasoline equivalents will retain less of their value after three years than the conventional models. For example the Honda Civic hybrid is only worth fifty-eight percent of its original value while a gas engine model is worth sixty percent. The absolute value of the hybrid is still higher due to the higher original price. Since all hybrids have long warranties on the batteries and other components, this doesn't contribute to the lower residuals. Instead ALG attributes this to greater price sensitivity among used car buyers who for now at least tend to be more interested in purchase price than fuel economy. That may well change in the future but for now you may want just buy and keep the hybrid for a while instead of leasing.

[Source: Automotive News - Sub. req'd]