Honda Jazz hybrid Australia's cheapest

The company that once sold the most expensive hybrid car in Australia – the bug-shaped Honda Insight that cost $48,990 when it went on sale in 1999 – has cut the cost of the technology by more than half in a little more than a decade.

The price of a hybrid car has snuck closer to the $20,000 mark, with the new Honda Jazz hybrid undercutting the baby Toyota Prius C by $1000 with a RRP of $22,990.

But don’t break open the bubbly just yet: it will still take at least 12 years to pay off the $7000 price difference between a Honda Jazz Hybrid and the most fuel-efficient petrol-only Jazz model.

Based on the national distance average of 15,000km a year, the Honda Jazz Hybrid would use 375 litres less fuel than the standard Jazz annually, equating to a fuel bill saving of $562.50 a year based on the price of premium unleaded at $1.50 per litre. (See the table below).

The arrival of the Honda Jazz hybrid is also likely to reignite debate about whether it is in fact a hybrid. It is 13 per cent thirstier than the Toyota Prius C hatch (Honda: 4.5L/100km versus Toyota 3.9L/100km).

Unlike Toyota’s pioneering hybrid technology released in 1997, the Honda hybrid system is unable to move the car from rest on its electric power alone. Instead, the Honda’s smaller electric motor gives the petrol engine a boost once the car is already at cruising speed.

Moving from a standstill is when cars use the most fuel. But the hybrid system in the Jazz is largely unchanged from the one Honda released in 1999, albeit adapted to newer models with redesigned battery packs.

The new Honda Jazz hybrid arrives in showrooms next week, but it is unlikely to make any impact on the massive sales lead held by fellow Japanese car maker Toyota.

Toyota has sold more than 4 million hybrid cars globally since 1997, and 1 million of those were sold last year alone. It took Honda 13 years to eclipse the 1 million mark, which it achieved in September last year.

THE METHOD IN THE HYBRID MADNESS:

Honda Jazz Hybrid
Price: from $22,990
Engine: 1.3-litre petrol engine, 10kW electric hybrid motor assists at cruising speeds
Power: 72kW/167Nm
Consumption: 4.5L/100km
Fuel used annually: 675 litres
Annual fuel bill: $1012.50

Honda Jazz petrol
Price: $15,990
Engine: 1.3-litre four-cylinder petrol engine
Power: 73kW/127Nm
Consumption: 7.0L/100km
Fuel used annually: 1050 litres
Annual fuel bill: $1575

Price gap in annual fuel bill: $562.50

Years to recover the $7000 price premium of the Jazz Hybrid compared with the cheapest model: 12.4 years 

Fuel use is based on the consumption figures on each car’s fuel rating label and the national average distance travelled of 15,000km a year. Fuel cost is based on $1.50 per litre, even though it will likely climb in excess of that over the next 12 years.

This reporter is on Twitter: @JoshuaDowling