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Wednesday, October 21, 2020

The staggering costs to own and operate a car in Australia

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AUSTRALIAN households are now spending up to $22,000 a year just to keep their cars on the road as toll ways, insurance, and other costs continue to rise — and congestion worsens.

The first ever Transport Affordability Index by the Australian Automobile Association (AAA) shows Sydney households face the highest transport costs of any city in Australia — both in dollar terms and as a percentage of household income.

A two-car household currently faces transport costs of $419 per week in Sydney, versus $376 in Brisbane and $348 in Melbourne.

But in the city where critical decisions on transport funding is made — the national capital, Canberra — the average weekly cost to run a car is $299, ranking it among the cheapest in the country.

The cheapest cities to own and operate a car were Perth ($300 per week), Darwin ($286), Adelaide ($285) and Hobart ($271), according to the study.

Road tolls contribute heavily to the weekly transport costs in the three most expensive cities — but even without tolls, the study found, they still top the list of the most expensive for transport in Australia.

In Sydney for example the higher costs relate to tolls, registration and Compulsory Third Party (CTP) insurance, which are the dearest in the country.

The study comes as figures show the Federal Government continues to pump a fraction of fuel excise back into roads. Just one dollar out of every four raised from fuel taxes will be spent on road transport by 2020.
“Motorists are not getting a fair return on their taxes,” said the chief executive of the AAA, Michael Bradley.

“Our research shows congestion is seen by Australians as having worsened over the past year, with many expecting it to deteriorate further in the coming year. Their dismay is supported by Government figures that show congestion currently costs our economy $16 billion per year and that this will rise to $53 billion by 2031.”
Mr Bradley said while Australians have not had a full view of transport costs in the past “it’s clear they know something is wrong”.
“Australians know transport is expensive, but they might be surprised to know just how expensive,” said Mr Bradley.
The Transport Affordability Index was commissioned by the AAA — the peak body of the motoring clubs in each state and territory, which represents 7 million motorists — and conducted by SGS Economics & Planning.

For the survey, a “hypothetical household” was selected in each capital city: a couple with children, the most common type of household in Australia.

The couple is a 38 year old woman and a 36 year old man — the average ages for a man and a woman in Australia. They live in a detached house and have two cars. Both are employed.

A typical passenger car is driven 13,800 kilometres per year, and is 9.8 years old. The model assumes the household’s two motor vehicles will be driven 15,000 and 10,000 kilometres per year.

The car that drives 10,000 kilometres per year is assumed to be ten years old and owned outright. The car that drives 15,000 kilometres per year is assumed to be a near-new vehicle (less than three years old) purchased new and financed with a car loan.

In each city, the hypothetical household is assumed to live in middle to outer ring suburbs, with a relatively high population density, good access to public transport, and in the case of the Sydney, Melbourne and Brisbane households, would need to use toll roads to access the CBD.

The rising household cost of running cars:

Sydney $419 per week, $21,788 per year

Brisbane $375 per week, $19,500 per year

Melbourne $348 per week, $18,096 per year

Perth $300 per week, $15,600 per year

Canberra $299 per week, $15,548 per year

Darwin $286 per week, $14,872 per year

Adelaide $285 per week, $14,820 per year

Hobart $271 per week, $14,092 per year

Source: Australian Automobile Association, March to June 2016

Online Source

The Indian Telegraph Sydney Australia

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