The Importance of a Car's Running Costs and Depreciation Rate over It's Purchase Price
After reading certain studies showing that some of the top selling cars in Australia weren’t always the most affordable to run, I became interested in which cars did save you the most money. Unsurprisingly, one of the cheapest cars in Australian to buy is actually also one of the most affordable to run as well, even though it has to be run on premium-unleaded fuel.
At the opposite end of the spectrum, one of the most popular vehicles sold during 2015 was actually the most expensive vehicle to run across the entire market. Fuel prices have dropped across the globe due to the oil glut along with interest rates, which is fantastic news for drivers everywhere, but as and when those prices begin to creep back up, is it worth making sure you have the most efficient car?
In 2015 the Suzuki Celerio, which starts at roughly $12,990, conquered the annual running costs league table at the Australian Automobile Associations (AAA). The AAA considers an array of factors when comparing vehicles such as the purchase price, registration, insurance, fuel consumption depreciation, and servicing the vehicle. Taking all of these costs in account, the AAA concluded that the Suzuki Celerio costs $97.65 per week to run.
At the opposite end of the spectrum, and also within the top 100 most popular selling cars of 2014 and 2015 (according to RACV), we have the Nissan Patrol and Toyota Land Cruiser 4-wheel drive beasts. These two vehicles cost a hefty $21,000 per year to run, which equates to more than $400 per week.
The RACV’s manager of vehicle engineering stated that he advised car buyers to look beyond the price of the vehicle and consider running costs and depreciation as well. In particular, many people ignore the fact that depreciation is the single most expensive cost associated with owning a vehicle.
If you were looking to buy a car that has the potential to save you the most money compared to all others on the market, the Suzuki Celerio is the way to go. It comes in both manual and automatic, however the automatic version accounts for 4 out of every 5 sold. The automatic transmission version costs $13,990 in Queensland, but around $12,990 in every other state. This is due to every other state having a subsidiary from the Japanese car manufacturer present.
I bet at this stage you're probably asking yourself "what about all the hybrid cars, surely they are more cost effective to run?" Well, according to the AAA, the Toyota Prius hybrid for example costs a considerably higher $10,216 per year to run or roughly $196 per week. The Honda Civic hybrid is even higher, costing $10,733 per year or $206 per week.
Looking at the popular Holden Commodore 3.0 litre V6, well it’s cheaper to run at $12,453 per year or $239 per week when compared to the four-cylinder Ford Falcon, costing $12,848 per year or $247 per week to run - and this boils down primarily to depreciation.
As a general rule, the less money you spend on a vehicle, the more money you save due to depreciation. Overall, the smaller the car, the cheaper they are to maintain and service, along with being cheaper to buy. However, any family will tell you that this simply isn’t possible if you're having to cart the kids around every day. That’s why if you are considering a family SUV, the Holden Captiva is the cheapest vehicle to own and run, costing $11,764 per year or $226 per week.