Hybrids are increasingly dominating new vehicle sales, with their average monthly payments lower than those for fully electric or internal combustion engine models. According to Experian’s State of the Automotive Finance Market report for Q2 2026, hybrids constituted 16.8% of new-vehicle financing, rising from 13% in Q2 2025, while EV financing dropped to 8.2% from 9.2%.
Factors contributing to this shift include the reduction of EV tax breaks and rising gas prices, which have made hybrids more appealing due to their affordability. The average monthly payment for new hybrid vehicle loans was $646, compared to $692 for EVs and $721 for gasoline vehicles. Leases also reflected this trend, with hybrids averaging $566 compared to $641 for EVs and $602 for ICE vehicles.
The report highlights that many top-selling hybrids receive financial support from OEMs. For instance, interest rates for popular hybrids like the Subaru Crosstrek and Mazda CX-50 Hybrid were significantly lower than the national average of 6.4%. Toyota led the market with three of the top five financed hybrids, emphasizing their commitment to hybrids over EVs.
Toyota reported a 35% increase in sales of electrified vehicles in June compared to the previous year, while maintaining low inventory and incentives. This strong performance showcases the growing preference for hybrids amid changing financial dynamics in the automotive market.
