09 Dec 2021

REVEALED: The real cost of running a family car may surprise you

But at least running costs are down on last year, survey reveals

Buying a car

Buying a new car?

The average cost of running a family car for a year is a whopping €10,386 according to the AA’s annual survey of motoring costs. That's around €200 per week.

However, the total is a decrease of €207.26 on the same figure for last year, according to the AA’s calculations.

The largest year-on-year change is a drop in the average cost of fuel by 9.75%. The average cost of a litre of petrol fell from 139.5 cent in July to 125.9 cent this month; diesel fell from 129.9 cent to 117.3cent. Over 60% of the price paid is tax.

Fuel prices have fallen significantly in recent months as a result of reduced global demand during the COVID-19 global outbreak.

Despite recent CSO data highlighting a drop in motor insurance prices, the motoring organisation has repeated previous calls for the next government and the insurance industry to ramp up insurance reform efforts to aid consumers. 

According to the CSO’s Consumer Price Index the average cost of motor insurance has dropped by 7.6% compared between June 2019 and June 2020.

 “The fuel drop is a real saving for all motorists.," says Director of Consumer Affairs Conor Faughnan.

“Insurance is different; the average has dropped but there are plenty of motorists whose particular price has not. Groups like returning emigrants, those with claims or other non-standard risks may not have seen any improvement and across the board the cost is still too high.” 

He added: “While the noticeable drop in driving costs is a welcome development for motorists, we cannot expect fuel prices, the drop in which have been central to the overall drop in motoring costs, to stay as low as they currently are forever.”

Each year the AA calculates average prices for each of the respective tax bands and illustrates the cost of running an average family car.  The cost of running a ‘Band B’ category2 car decreased by 1.96% in 2020 when compared to the 2019 figure.

Other motoring costs did not change significantly with only slight adjustments to be made3. This is reflected in the AA’s calculation of the cost of oil, tyres, servicing, repairs, replacements and garage parking.

The AA calculates the annual cost of motoring each year using a holistic figure that includes the obvious things like fuel, insurance, servicing but also factors in a whole range of other costs.

These include costs like depreciation and interest charges, as well as replacement for components such as tyres etc. over the car’s life.

The figure assumes a motorist that buys a new car and retains it for 8 years at an average annual mileage of 16,000 kms.

All repairs, replacements and servicing are carried out as per manufacturer’s recommendations.

The AA index figure is in use for many years. It assumes a Band B car bought new and depreciated over 8 years doing 16,000 kms per year (higher than the national average but a typical figure for family use). The AA also estimates a charge for parking, including a garage at home, that some motorists may not pay at all, which means the out of pocket costs are likely to be lower.


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