Best Used Plug-in Hybrid Cars to Take Advantage of the PHEV Tax Credit
Plug-in hybrids are ideal for buyers who want to take advantage of the federal tax credit but are hesitant to make the full leap to electric vehicles. As with used electric vehicles, used plug-in hybrids are eligible for a rebate of up to $4,000 if purchased from a dealer. Instead of waiting until tax time, customers can now deduct that amount from the price of their used plug-in hybrid at the time of purchase.
To meet the rules, a used plug-in hybrid vehicle must be:
- Its price does not exceed $25,000.
- Must be purchased from an authorized dealer; no private sales.
- The model must be at least 2 years old.
- Cannot be the original owner
- Only one used car credit can be claimed every three years.
- The battery capacity must be at least 7.0 kWh and be rechargeable from an external power source.
We used Car and Driver ’s “What’s My Car Worth” tool to determine the values of 11 plug-in hybrid models, keeping prices between $15,000 and $25,000 to maximize the value of this government incentive. We looked for cars with clean titles nationwide. Most of our plug-in hybrid picks have mileage ranging from 20,000 to 50,000 miles. (There are caveats that could result in your used electric vehicle tax credit being reduced or forfeited, so check out our tax credit guide before you buy.)
Only licensed dealers approved by the IRS can offer the plug-in hybrid credit, and that includes nationwide used-car dealers like Carvana, which can handle the majority of online transactions. But there’s a loophole. Dealer brokers like KeySavvy , which collect payments and verify titles, process the plug-in hybrid credit at a private sale for a fee.
car and driver
BMW X5 xDrive40e 2016-2018 model
BMW sold the last generation of the X5 with six powertrains, including a plug-in hybrid and a diesel. The plug-in hybrid was called the 40e and used a 2.0-liter turbocharged four-cylinder engine ( current 45e and 50e PHEVs for 2021 and beyond use a turbocharged six-cylinder engine). The combined system output of 308 horsepower was enough to propel the SUV to 60 mph in 6.2 seconds, 0.2 seconds behind the regular gasoline six-cylinder. This generation is as attractive as ever and has a spacious, airy cabin. Its 14-mile electric range and overall fuel efficiency aren’t impressive, but the hybrid aspect doesn’t spoil the X5’s driving experience.
Toyota
Before the Prius Prime became a household name with its 2023 redesign , Toyota’s plug-in hybrid Prius was mostly known for its oddball styling and stingy fuel economy. The previous-generation Prius Prime had an EPA-estimated 25 miles of electric range, and when the battery ran out, it would still get more than 50 mpg on gas. Recharging takes 5.5 hours on a standard 120-volt household outlet or about two hours on a 240-volt source. This Prime is slow, and the instrument cluster is awkwardly positioned in the middle of the dashboard instead of in front of the driver. But efficiency and sheer reliability are the draw here.
Mitsubishi/David Durst
Mitsubishi Outlander PHEV 2022
Shop for a used OUTLANDER PHEV
Mitsubishi was the first to market a plug-in hybrid SUV , though it wasn’t until 2018 that the Outlander PHEV landed on our shores. The Outlander has CHAdeMO fast-charging capability and an EPA-rated 24 miles of range. Buy one of these, and you’ll also get plenty of space and all-wheel drive, and you still have three years of factory warranty coverage (which goes up to five years and 60,000 miles). Keep in mind when searching: Mitsubishi redesigned the regular Outlander for 2022, but the 2022 Outlander PHEV is the previous-generation model.
Cadillac
General Motors would probably rather forget that it made this car and the ad that didn’t sell it . Cadillac’s version of the Chevrolet Volt wasn’t any faster and was only marginally more luxurious. From a starting price of $75,000, the ELR got a $10,000 price cut for its latest 2016 model year that couldn’t save it. Still, the Volt was a very good plug-in car, and now that the ELR has lost 75 percent of its value, it’s time to revisit this plug-in hybrid coupe. Who makes plug-in hybrid coupes anymore? This was the pinnacle of the brand’s art and science design . The wise move is to get the 2016 model with improved suspension and brakes in addition to increased power and torque.
Mark Urbano, Manufacturer
The previous-generation 3 Series introduced the first plug-in hybrid, the BMW 330e . The trick might be finding one. The 330e wasn’t popular when it was new, with its $5,350 premium buying 14 miles of electric range, a smaller trunk, and no all-wheel drive. The extra weight doesn’t diminish the 3’s lively handling, though, and there’s an eight-speed automatic transmission—sometimes with the electric motor engaged alone, which feels odd but satisfying. The iPerformance moniker is misleading. With the gas engine borrowed from the 320i, the 330e is lively but certainly not quick.
Chris Amos | Car and Driver
2018-2019 Honda Clarity Plug-in Hybrid
The futuristic Honda Clarity was sold from 2018 to 2021, and it’s largely been forgotten. The gas-electric four-door—which was also available in all-electric or hydrogen-powered versions—offered an EPA-estimated 48 miles of range. With 212 horsepower, the Clarity was faster than a Prius Prime and still got 42 mpg on its gas-powered engine once the battery was depleted.
Michael Simari | Car and Driver
Audi A3 Sportback e-tron 2016-2018
Shop for a used A3 SPORTBACK E-TRON
While Audi has been offering efficiency-minded buyers its TDI diesel engines, Volkswagen’s diesel emissions scandal has driven the company into a brick wall. The brand was forced to go electric, and an early effort was the A3 Sportback e-tron, which was offered only as a four-door hatchback. The 1.4-liter turbocharged four-cylinder and 8.8-kWh battery were good for respectable acceleration ( 6.5 seconds to 60 mph in our test ) and a typical EV range at the time of 17 miles. However, high pricing limited the appeal (our 2016 test car as tested was $46,100). Depreciation on a pricey German car is a good thing for used-car buyers.
Chevrolet
The Volt, which debuted for the 2011 model year, was the first plug-in hybrid and the best in terms of range, performance and technology. At that price, you could get a low-mileage first-generation Volt (25 to 38 miles of electric range) or a higher-mileage second-generation Volt (53 miles of electric range). Both Volts are fun to drive and easy to charge from a home outlet, since the battery is small compared to the massive battery packs in today’s electric cars.
Ford
The last-generation Ford Fusion has consistently sold well and looked great. Many have compared the front end to an Aston Martin. Right. Like GM, Ford has been very forward in the plug-in hybrid market, and this midsize sedan offered 20 miles of electric range and nearly 40 mpg on gas. Recent model years (2017-2019) have higher EPA ratings. The small eight-cubic-foot trunk is a downside, and we weren’t overly fond of the soft suspension and light steering. Otherwise, this is a well-executed sedan that Ford should keep selling in this country.
Chrysler
2017–2022 Chrysler Pacifica Hybrid
Shop for a used Pacifica Hybrid
The Pacifica was and remains the only plug-in hybrid small car. Stay away from the early model years, as our 2018 long-term test car required a battery replacement and suffered from too many ailments to list here. Later models are the delights, as evidenced by Ezra Dyer’s 2020 personal model with its flaming red leather seats. The 2021 facelift brings a new front fascia and an updated infotainment system. We matched the EPA’s 33-mile range on all-electric and achieved 31 mpg on our highway test, which equates to 540 miles per tank. For utility and space, there’s no better plug-in hybrid.
Kia
2018–2022 Kia Niro Plug-in Hybrid
Shop for a used Niro plug-in hybrid
The Niro is a subcompact hatchback with three powertrains (hybrid, plug-in hybrid, and electric). There’s nothing particularly exciting, inside or out, and the performance is straightforward. But for affordable electric driving, especially in congested cities, the Niro plug-in hybrid is a great car with low maintenance. If you want a current-generation Niro for under $25,000, wait until the 2025 model hits showrooms and then look for used 2023 models (the car’s first year of operation). The updated styling and technology may be worth the wait.