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Cost of running a car rises by 21% in a year12 June 2011by Emma Jamieson According to a poll of 2,000 adults conducted by Sainsbury's Bank, the cost of running a car has risen by 21% over the last year. The biggest contributors to this rise have been, of course, the increased costs of fuel and of car insurance. It now costs the typical driver over £3,000 a year to keep his car on the road. The study generated a relatively conservative figure of 31% for the average increase in car insurance (the average policy price now being £812 according to the study). The cost of fuel increased by 23% to £1,721 (based on a Ford Focus travelling 10,000 miles). Car servicing costs increased by 5%, the MOT by 1.6% and motoring taxation was up by 5%. In view of the huge increase in car insurance, only 18% said that they would not consider a switch of car insurance provider, while 6.2% said that they had obtained more than five quotes. The last two figures taken together show that while the majority of people in principle are interested in shopping around to find cheaper car insurance, in practice, few do so. This is consistent with the finding from Gocompare's research, that we also reported here, that less than a third switch their car insurer when it's time to renew their cover. However, price comparison sites have reported increased use and clearly larger numbers than before are now willing to compare numerous prices with a view to reducing their overall motoring costs. Indeed, in our poll of those using this website, as many as 63% prioritised getting cheap car insurance over getting the best cover. As a result of these increasing costs of running a car, larger numbers now report a reduction in their car use, with a recent study suggesting, for the first time, that the majority have now cut their car use. Similarly, a half of drivers plan to buy a more fuel efficient car when they trade in their current vehicle. People have also been changing their driving style to become more fuel-efficient, with, for example, many deciding to slow down on motorways to conserve fuel. Interest in car-sharing to double up when commuting, so reducing annual mileage, has also increased. In some cases, notably younger drivers, people have simply been priced off the road. New driver car insurance not unusually costs £6,000 nowadays which, even for those that can afford it, does beg the question as to whether driving is worth it at such high cost. As a result, the numbers of teenagers taking their driving test has slumped, the obvious point being that if they cannot afford to drive, there is no advantage to taking driving lessons at personal cost. With car insurance set to rise above inflation for several months before prices begin to level off and an even worse picture for fuel costs that are likely to continue to rise well above inflation on the longer term, perhaps we are entering a phase where car ownership will no longer be a given for many families or individuals that are currently able to run them. However, we do like our cars and their convenience and life-enhancing effects will lead to the sacrifice of other areas first (for example, the taking of less holidays) before we give them up. |
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