Sunday, February 16, 2014

Why you shouldn't buy a Nissan Leaf

In 2009, I thought the Nissan Leaf was a really cool car. 100% pure electric, no need for gas. Sounded pretty amazing.

But, that seems like the biggest appeal. No gas bill.

Today, a new 2014 Nissan Leaf costs $30,000. If the federal tax credit of $7,500 is still available, the actual cost comes down to $22,500.

In a few minutes, I did an analysis to see how long it would take to recoup the savings for gas.

My commute is 40 miles, round trip, 5 days a week.
On average, I spend $150 a month on gas.
That comes out to $1,800 per year on fuel.

$22,500 (price of leaf) / $1,800 (fuel cost per year) = 12.5 years.

So with this calculation, you need to have the Leaf for more than 12.5 years to save money on gas. Keep in mind that this is only an analysis of saving fuel. New cars carry higher insurance costs.

Now the above calculation does not include inflation. Lets set inflation at 3% per year for gas.

Fuel costs
year 1 $1,800
year 2 $1,854
year 3 $1,909.62
year 4 $1,966.91
year 5 $2,025.92
year 6 $2,086.69
year 7 $2,149.29
year 8 $2,213.77
year 9 $2,280.19
year 10 $2,384.59
year 11 $2,419.05

total costs after 11 years = $23,054.03

Even after adjusting for inflation, it takes more than 10 years to recoup the cost of just gas.