AA: Running a car now cheaper

Published: 6:42PM Saturday August 23, 2008 Source: ONE News

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Motorists may be suffering from high fuel prices but the Automobile Association says the overall cost of running a vehicle has fallen dramatically over the past 20 years.

While motorists are hurting from record pump prices, the AA says it's cheaper to run a car these days.

"Everybody's got a Jap import, and everybody's got a relatively cheap, reliable vehicle so in that respect, they're entirely correct," says Clive Matthew-Wilson from the Dog & Lemon Guide.

Back in 1988, when petrol cost 89 cents a litre the average operating cost for a near new vehicle was 54 cents a kilometre and average incomes were almost $36,000 which meant that running a car took up 21% of household incomes.

But if the latest figures are applied higher incomes have more than compensated for rising costs and running a car now takes only 15% of household incomes.

But Matthew-Wilson believes the average figures are potentially misleading.

"For the people on poor incomes, which is now an increasing number of New Zealanders, the situation has got noticeably worse," he says.

And people are not convinced running costs have fallen 30% over the past 20 years when fuel has gone up by 140%.

Future running costs won't just be about fuel.

"I think that if toll roads become normal in New Zealand, which it's likely to do if National takes power, then they will take another chunk out of the motoring budget for the average person," says Matthew-Wilson.

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