Buying a environmentally friendly vehicle could earn you tax credits, rebates and other discounts.
By buying a green vehicle you can save far more than a fistful of dollars at the gas pump. Instead, you can fuel up your bank account with thousands of dollars in savings.
Green vehicle sales have been in the fast lane so far this year, surpassing 450,000, according to AutoblogGreen. That’s up 26 percent from the first eight months of 2012. And August sales are charged up even more, reaching more than 72,000 units. That’s up nearly 50 percent from the year before. The Toyota Prius continues to lead the pack when it comes to sales of green vehicles, accounting for more than 35 percent of sales of hybrids and alternative-fuel vehicles in August alone.
The surge in green vehicle sales comes at a time when auto sales in general continue to climb. Overall, more than 1.5 million vehicles were purchased in August, up 17 percent from the year before. While the growth in overall auto sales figures is impressive, it pales in comparison with those of green vehicles.
While hybrids and alternative-fuel vehicles generally cost more than their gasoline-powered counterparts, there are a number of unexpected ways to add a stack of green to your bank account by buying a green vehicle.
1. Federal tax credits
If you buy an electric vehicle, you’ll get plenty of bang for your buck in the form of a federal tax credit. The tax credit for purchasing an electric vehicle is a whopping $7,500 and includes such popular models such as the Ford Focus EV and Nissan Leaf
The U.S. Department of Energy website has a list of autos that qualify for the electric vehicle tax credit.
You also can score a tax credit if you purchase a plug-in hybrid-electric vehicle, which combines the features of a traditional hybrid vehicle with an electric vehicle.
Those credits range from $2,500 for a Toyota Prius plug-in hybrid to $7,500 for a Chevrolet Volt. You can get details on the plug-in hybrid-electric vehicle tax credits on the U.S. Department of Energy website.
2. State rebates
Certain states also offer rebates on green vehicles, so you need to be sure to check with your home state to see what is available.
In California, for example, you can get a rebate of up to $2,500 for buying or leasing a zero-emission vehicle or plug-in hybrid vehicle.
Pennsylvania provides a $3,000 rebate for purchasing a plug-in hybrid electric vehicle or electric vehicle, and smaller rebates for other types of vehicles.
3. Auto loan savings
This is another one you’ll have to scout around for, but a number of banks and credit unions offer discounts on auto loans if you buy a green vehicle. These often are available for gas-powered vehicles with good fuel economy, hybrids or alternative-fuel vehicles.
Discounts are generally 0.25 percent or 0.50 percent off the interest rate of your auto loan.
Many financial institutions use the U.S. Environmental Protection Agency’s SmartWay Vehicle certification to determine if a vehicle is eligible for a discount. Information is available at www.fueleconomy.gov.
4. Insurance discounts
Some auto insurance companies offer discounts if you drive a green vehicle. Discounts on your premium will vary based on the state you live in and other individual factors.
Travelers offers a discount if you own or lease a hybrid, while Farmers offers a discount for hybrid or alternative-fuel vehicles.
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