Car Cost – Example Car Running Costs

23 Jul 2014 | Author: | Comments Off on Car Cost – Example Car Running Costs

Car Running Costs Examples

The Cost of Running a Car

Everyone knows that running a car costs a lot of money. But how much is a lot of money? would you be better off taking the bus? Or is running a car well worth the money when compared to the cost of other forms of transport?

Whatprice have gathered some car running cost data already.

We also have a handy car running cost calculator to make things easy for you.

Owning a car is a complicated business and there are many hidden costs that you may not first consider. Take a look at our page on tax, MOT and Insurance for a full explaination of car ownership obligations.

UK Car running costs example

This example uses a Renault Clio 1.2 litre (made in 2001, bought nearly new in the UK ) to calculate a cars running costs.

Obviously the running costs will vary from car to car, if you are interested then you should do the calculations yourself, and submit them to Whatprice!

The simplest way to calculate the cost of running your car is to add up all of your bills over the year, take into account depreciation of the car, and that’s your cost. However this doesn’t really give a good comparison to other forms of transport, and certainly doesn’t help when claiming mileage for business. Therefore a much better way to calculate car running costs is to work out the cost per mile..

To work out the cost per mile of owning a car simply take the annual car cost and divide by your yearly mileage rate. Typically this would be around 12,000 miles a year, but this obviously varies a great deal on how you use the car.

Petrol Running Costs

Next time you fill up the car with petrol, fill it the absolute maximum fill level and then zero your mileage counter. When you come to refill your car again, take the mileage reading and record how many litres of petrol you use. The amount of petrol you use will obviously vary depending on how and where you have driven your car, so it is probably worth repeating this cost calculating exercise a few times to get a good average petrol cost figure.

If you want to save on refueling costs then check out our very own petrol price map showing you the cheapest petrol prices in your area.

Cost per mile (p/mile)= Litres put in x 81p / number of miles

Annual Running Cost (£) = Cost per mile x Average mileage /100

For a Renault Clio

Cost per mile = 40 x 81 / 400 = 8.1p per mile

Car Insurance Costs

Obviously car insurance costs vary a great deal from driver to driver, and it pays to shop around. We did this on Whatprice and were shocked at the varying car insurance prices that we found for a 40 year old male and a 22 year old female driver.

Annual Running Cost = Your annual insurance bill

Annual Running Cost = £350 (2 years no claims)

Running Cost so far = 11p/mile or £1320 a year

Car Service and MOT Costs

Again car service prices vary a great deal from car to car and depend on where you get your car services. Typically a service would cost around 100 pounds a year. but this can be much more if you get it properly serviced at an authorized dealer.An MOT would be around 50 pounds a year, as long as the car doesn’t require any extra work.

Car Tax

Unfortunately we all have to pay this, and its about 100 pounds a year for a reasonably non polluting car, this increases slightly for the large, gas guzzling cars.

Car Wear and Tear Costs

This is a catch all category that collects all the car costs that aren’t included elsewhere. This should contain small items such as oil refills, bought washer bottles, replaced light bulbs and replacement of worn tyres. These may seem like small amounts but the costs can quickly add up!

1 can of car engine oil = £10

2 new car tyres = £120

1 new washer blade = £10

1 new car hubcap = £12

Depreciating Car Value

This running cost of cars is usually forgotten, which is unfortunate as it can often be the biggest expense! Your brand new car is depreciating in value every mile that you drive it, especially when you first drive it off the forecourt. So although once you have bought the car you wont see this added cost it should be taken into account when working out the total running cost of a car.

Annual Depreciation Cost = (Value when bought – Current value) / Years

Cost per mile = Depreciation / annual car mileage x 100

For a Renault Clio

Annual Running Cost = (£5500 – £3000) / 3 = £833

Cost per mile = £833 / 12,000 x 100 = 7p

Running Cost so far = 20.9p/mile or £2503 a year

So there you have it! To run a Renault Clio costs just over £2500 pounds a year, or £208 a month. So the running costs aren’t quite as bad as mortgage payments, but they are still pretty significant..

Note that a Renault Clio is a very cheap car to run, so don’t be surprised if you work out that your running costs are more than twice this figure. But don’t forget, no matter what the running cost of your car is, please let us know !

Check out our car running cost calculator to work out your personal running costs

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