It doesn’t change if something lowers or increases the TCO, it only scales the impact relative to the costs.
The cash on hand bit isn’t the only take, but if you’re comparing 5 year loans and only keeping the car for 5 years then you can ignore time value of money. Suppose the monthly payment is 50$ more and you save 60$ a month, sure it’s only saving 10$/month but that’s essentially free money.
It’s becoming a tired discussion, but this has already been covered. For someone willing/capable of dropping $30k-$50k in cash, $10/mo. is certainly a small effect size. Under certain cases, hybrid TCO will be lower. For example, if you’re buying an SUV, drive a lot, pay cash, and live in a high fuel cost locale. But that shouldn’t lead to a logical leap that hybrid costs are lower in the general case. (They still may be, but nobody has shown good, generalizable data to that point.)
I said loan not paying cash. We’re comparing if the drive train is superior, and the most cost efficient new car is a car. Upgrading to a 50k SUV is inherently a different question that has little to do with the drivetrain.
> They still may be, but nobody has shown good, generalizable data to that point.
The general case of someone keeping a vehicle for 8 years and driving 15k miles per year isn’t close, as long as we’re keeping everything else the same. EX: A 2025 Ford Escape ST-Line Elite has a hybrid option for an extra 1,205$. If the base price is significantly higher than 2,000$ you’re not comparing drive trains but options.
Plug in Hybrids are a separate category dependent on your local electric prices.
The cash on hand bit isn’t the only take, but if you’re comparing 5 year loans and only keeping the car for 5 years then you can ignore time value of money. Suppose the monthly payment is 50$ more and you save 60$ a month, sure it’s only saving 10$/month but that’s essentially free money.