In order to boost the market for hybrids, the U.S. federal government offered tax credits to offset their purchase beginning in 2005. The catch was that it applied only to the first 60,000 hybrid vehicles sold by each manufacturer. Some car makers have surpassed that limit.
New federal incentives are available for plug-in hybrids. They range from $2,500 to $7,500 depending on battery size. It definitely pays to shop around for incentives, which can make a hybrid much more affordable or attractive. Some additional incentives:
- Various states offer their own income tax credits for hybrid purchases.
- There's a federal tax credit that covers 50 percent of the cost of a plug-in hybrid charger.
- Some cities allow hybrids to park for free in municipal lots.
- Retailers like Whole Foods and Home Depot offer preferred parking at some stores.
- Some cities allow single-passenger hybrids to travel in car-pool lanes.
- Insurance companies can offer additional savings. For example, Travelers gives hybrid owners a 10 percent discount.
Checking out all the incentives takes some digging, but together they may make or break your hybrid purchase decision.