Vehicle Running Costs

What are Vehicle Running Costs?

Are you purchasing a car soon? If so, it is important to consider the running costs of the vehicle you are buying. Here are some important factors to consider.

What are vehicle running costs?

When making a car purchase, most people think about the cost of the vehicle as being the sticker shown on the windscreen with little regard for anything else. The fact is that the price tag of a vehicle is just one (albeit large) portion of what it costs to own it. For one thing, you will need to keep fuel in the tank. For another, there are financial factors such as taxes and insurance.

To help you assess the true running costs for a vehicle, here is a list of things to keep in mind during the car-buying process. 
What are vehicle running costs?

Fuel

Electric cars have made their way back into the new-car market, but the majority of vehicles you can buy still run on either petrol or diesel. While fuel may seem like a small cost from week to week, it can actually become a significant annual expenditure depending on the vehicle you buy. Over time, small differences in fuel economy can add up to big bucks – sometimes hundreds or thousands of dollars – a year.

Purchasing a fuel-efficient vehicle can do wonders for your financial budget. Vehicles that are thirsty at the bowser will reduce the amount of money you have for spending on other important ownership aspects such as repairs or upgraded insurance. High-performance cars or big SUVs typically consume a lot of fuel, though they can still vary greatly between models – so be sure to compare fuel consumption figures.

Insurance

Every state and territory of Australia legally requires vehicle owners to have a compulsory third party (or CTP) insurance policy. This coverage provides the bare minimum for injury costs if you get in an accident and injure someone. It does not cover damage to their property which you could be held liable for.

Other types of insurance include:

Third party property only - pays for any damage you cause to another vehicle or other property if you get in an accident.

Fire and theft - covers your own vehicle. In the event that your car catches fire or gets stolen, the insurer will provide a replacement.

Comprehensive - covers any sort of natural damage such as storms or falling branches. Also covers damage to your vehicle after a collision.

Other than CTP, insurance policies are optional. However, if you have invested in a new or valuable car, insurance may be cheaper than having to pay for any damage you incur from car accidents or natural disasters.