If you’re looking to buy a green vehicle, it appears you’re more likely to simply drop a bunch of green to do it, according to a recent study.
Buyers of alternative fuel vehicles last year were more likely to pay cash for their EV or hybrid than those purchasing a vehicle with a traditional internal combustion engine, said Experian Automotive.
Sales of those vehicles have been in the decline through the first quarter of this year, but those buying them are pretty much a sure thing for automakers. More than 18% of consumers that purchased a “Green” vehicle paid in cash, compared to 15.2% of those that purchased a gas-powered vehicle, the company said.
“Despite the increases we have seen in automotive financing over the past few years, it’s interesting that a larger percentage of consumers buying ‘Green’ vehicles are choosing to buy with cash,” said Melinda Zabritski, senior director of automotive finance for Experian.
“To put it in context, nationally, consumers purchased new vehicles with cash roughly only 16% of the time. A possible reason for this could be that consumers buying ‘Green’ vehicles are in the highest credit tiers, which could indicate they have more disposable income than those buying a gas vehicle.”
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Because they’re in the top credit tier, when they do finance or lease their vehicle, they’re paying less due to better interest rates. Nearly 83% of consumers who purchased an alternative-powered vehicle fell within the prime credit category, compared to 71.5% of consumers who purchased a gas-powered vehicle. Additionally, the average credit score of a consumer purchasing “Green” was 737, while it was 711 for traditional vehicles.
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- In 2014, 53.3% of consumers took out a loan to purchase a “Green” vehicle, while 70.2% of consumers took out a loan to purchase a traditional model
- For leases, 28.2% of consumers leased an alternative-powered vehicle in 2014, compared to 29.6% of consumers leasing a gas-powered vehicle
- The average loan for an alternative-powered vehicle in 2014 was $27,288, compared to $27,817 for a gas-powered vehicle
- In 2014, the average monthly payment for an alternative-powered vehicle was $468; gas-powered vehicles were $473
- The average lease payment for an alternative-powered vehicle was $358, compared to $407 for a gas-powered vehicle
- The top five states with the highest percentage of alternative-powered vehicle registrations in 2014 were California, Hawaii, Oregon, Washington and Georgia
“While consumers purchasing an alternative-powered vehicle can satisfy their environmentally conscious side, the influx of traditionally powered vehicles with extremely high fuel efficiency have presented more options for consumers looking to save a buck at the fuel pump,” Zabritski said.
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At the model level, nearly 50% of all “green” vehicles registered in 2014 were Toyotas, led by the Toyota Prius at 24.7%. The remaining top 10 included the Toyota Prius C (7.4%), Ford Fusion (6.9%), Toyota Camry (6.8$), Nissan Leaf (5.8%), Toyota Prius V (5.7%), Ford C-Max (4.2%), Hyundai Sonata (3.8%), Chevrolet Volt (3.5%) and Lexus CT 200h (3.3%).