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Cost of Motoring Soared in 2011

The latest annual figures mean drivers now have to pay on average £128.64 per week, or 55.74 pence per mile to own and run their vehicles. What’s more, it now costs an average of £1,556 per year more to own and run a car than it did in 2007, before the financial crisis and subsequent recession.

The Cost of Motoring Index, which is based on a pool of 17 new cars weighted by their ownership, is calculated by taking into consideration all the various financial outgoings associated with owning a new car. These include: depreciation, finance, service, maintenance, repair, fuel, insurance, road tax and breakdown cover .

When depreciation and finance are excluded, day to day running costs are also up a staggering 11% per year to £2,741.

The cost of motoring and percentage variances compared to 2010:

Consideration

New Cars 2011 – £

New Cars

 

2010 – £

Percentage Change

Fuel

1458

1298

12.40%

Insurance

551

483

14.38%

Maintenance

472

434

8.8%

Vehicle Excise Duty

111

111

-0.00%

RAC Membership

149

143

4.21%

Depreciation

3582

3068

16.67%

Car Finance

366

333

9.85%

Total Cost (Per Year)

£6,689

£5,870

13.96%

Total Cost (Per Week)

£128.64

£112.88

13.96%

 

Fuel and insurance causing pain for motorists

Yet again, the largest single increase in running costs is fuel which has increased by £160(£3.07/week) since 2010 – this represents a 12.4% increase in just one year. This has hit average drivers, such as the ‘Focus Family’, hard.

There has been a significant increase in fuel prices with petrol up from 118.4p/l to 134.78p/l, an increase of 13.8% and diesel up from 122p/l to 140.49p/l, an increase of 15.16%. One small consolation for motorists is that these increases have been slightly offset by an improvement in fuel consumption of 1.8%.

Insurance costs have also risen sharply, rising 14.4% to an average of £551. This increase has been driven by rising costs for insurers from personal injury claims and associated legal costs, insurance fraud and uninsured drivers involved in accidents. The cost of insurance is now 35% higher on average than in 2009.

Adrian Tink, RAC motoring strategist, comments: “This year’s Cost of Motoring Index highlights the tough conditions being faced by Britain’s motorists. With the annual cost of motoring approaching seven thousand pounds the price burden of car ownership is hitting drivers hard. The increase of almost three times the rate of inflation is crippling drivers’ wallets and something needs to be done to stem the tide.

“With fuel prices continuing to be the biggest single running cost, UK drivers want action from the Government.  Last week’s Commons debate, prompted by the Fair Fuel UK campaign, showed the real depth of feeling across the country on this issue. At the very least, we are calling for the scrapping of next year’s planned fuel duty increases.

“However it’s not just down to the Government.  Oil companies need to be more transparent over pricing so that drivers know exactly where their hard-earned money is going.  The Cost of Motoring Index makes it quite clear that motorists are already paying way over the odds. Further increases to fuel prices are simply a step too far.”

Gap in costs between used cars and new cars widens slightly

Despite an increase of 13.2% in used car costs3 it is still considerably cheaper (£1,965 or 29.4%) to own and run a used car compared to a new one. This gap has widened slightly from 2010, when used cars were 28.8% cheaper to own and run. The main reason for this cheaper cost is the considerably smaller depreciation suffered by used cars (£1,286) compared to new (£3,582).

However, despite the cheaper cost of used cars overall, when depreciation and the cost of finance are stripped out, used vehicles are actually £361 more expensive to run than new cars. The main reason for this is the higher cost of maintenance for used cars, which typically require more work for wear and tear after several years on the road. It costs an average of £713 for service and maintenance for used cars in 2011, which is £241 or 50.9% more expensive than for new cars.

Types of car

As in previous years, there are still large variations in the cost of running different sizes of car:

 

For owners of large family cars, the cost of service, maintenance and repair is also higher. It costs an average of £499 for maintenance of these vehicles in 2011, compared to just £367 for small cars, £433 for family hatchbacks and £445 for people carriers.
The cost of fuel and depreciation are the most significant contributors to the higher cost of owning and running a larger car. Drivers of these vehicles, such as a Ford Mondeo, pay an average of £659 or 49.3% more in fuel costs each year than drivers of small cars.

: 30th Dec 2011 11:02:00

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