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The Economics of Hybrids

It's getting a lot easier to buy a hybrid -- but not necessarily cheaper.

Amid heightening concerns over America's proclaimed oil addiction, skyrocketing fuel prices and global climate change, auto companies are making more gasoline-electric hybrid cars and giving consumers more choices than ever before.

But marketplace dynamics in the U.S. -- including higher prices charged by the car companies, dwindling tax credits given to fuel-efficient cars and low gasoline taxes -- haven't yet allowed a hybrid or other more-efficient vehicle to become an economical choice for many consumers.

In Europe, by contrast, several countries offer significant tax breaks to people who buy more-efficient vehicles. And high fuel taxes also are propelling Europeans to invest in a more-efficient ride.

Mild or Full

There are several hybrids on the market now, using different technologies. But basically, a hybrid consists of a traditional internal-combustion engine paired with an electric motor. The electric motor gets its power from a storage battery, which is replenished by a recharging system within the car's powertrain. Electric motors boost power to the gas engine, allowing manufacturers to install smaller -- and thus more-efficient -- motors in these cars. Most hybrids sport four-cylinder engines as opposed to the six- or eight-cylinder motors found in many vehicles.

There are essentially two types of hybrids on the mass market today, often dubbed "mild" or "full" hybrids, each with fuel-sipping and emission-curbing features. A mild hybrid shuts off the engine at a full stop; uses regenerative braking, which utilizes dissipated energy from braking to recharge the battery; and uses the electric motor to help power the gas engine.

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