ANNEX A TO ITEM 7

Report No. 12-182

Petrol Car Operating Costs

2012

After carefully analysing all costs and values, the 2012 car running costs for
petrol cars remained relatively unchanged from the previous year; there was
a minimal increase of 1.1%.

Small:
Compact:
Medium:
Large:

The price of fuel was taken for the average of 91 and 95 octane over the
month of June, which was the same as the 2011 fuel costs.
The slight reduction of the interest rate on opportunistic investment offset
nearly all other increases like tyres, maintenance, oil and warrant of fitnesss.
Whilst the fixed costs (Capital Outlay + Interest) fell slightly, the marginal
increase in the flexible costs (fuel + maintenance) offset the operating cost
and accounted for slight increase.
As the AA operating costs are calculated on ownership of a new vehicle for
the first 5 years, depreciation is still one of the biggest influences on the
overall result.
A noticeable change in vehicle classes was recognised. Large engines are
now replaced with smaller and more fuel efficient power plants. The same
power output is achieved with the fitting of a turbo charger. When selecting
a category or class of vehicle, it is imperative to keep the cars value in mind.
The operating cost calculations are a combination of two components, the
fixed costs (registration, insurance warrant of fitness and depreciation) and
the operating costs (fuel and maintenance).

Smallest hatchbacks and city type cars.

Slightly larger sized sedans, hatches or wagons.
Popular family oriented vehicles, mid-sized SUVs
and Crossover vehicles.
Larger capacity and luxury vehicles and large SUVs

The chart on page one indicates the average annual ownership costs based
on New Zealands average distance travelled of 14,000km per year. The chart
on page 2 can be used to calculate reimbursement rates for the actual
annual distance travelled from 5,000km to 30,000km per year.
Locate your TOTAL (work related + personal) distance to identify how much
the vehicle costs to operate over that period. That figure can be applied to
your work related distance for a suitable reimbursement rate.
Remember, AA calculates rates based on the first 5 years of a NZ new
vehicles life, so be realistic. A low value, older vehicle will have depreciated
about as far as its likely to, so the fixed costs will be minimal.
Employee/employer negotiation may be needed to determine a fair rate for
older vehicles if these figures are being used for reimbursement purposes.
For example, the fixed costs may need to be adjusted downward while the
day-to-day running costs may require an increase to allow for unforseen
costly mechanical repairs. The result may however reduce the overall
running cost, such is the influence depreciation has.
Insurance assumes a 35yr old male driver with full no claims bonus, a fully
comprehensive policy including glass cover and excludes drivers under 25.

The running cost schedule is separated into four main categories;

(PETROL DRIVEN VEHICLES) ESTIMATED ON 14,000KM PER YEAR FIRST FIVE YEARS OF OWNERSHIP

CATEGORY

Small
0 - 1500cc
new rrp to
$34,000

Compact
1501cc - 2000cc
new rrp to
$42,000

Medium
2001cc - 3500cc
retail price to
$60,000

Large
3501cc +
new rrp to
$75,000

Average value of vehicle surveyed

$29,077

$34,284

$47,462

$66,893

Average value at start of third year

$15,992

$18,385

$29,245

$38,229

Annual relicensing

$288

$288

$288

$288

FIXED COSTS

Insurance - Comprehensive, No Claim

$677

$750

761

$1,089

Warrant of Fitness (annually for the first 6 years)

$49

$49

$49

$49

Total Outlay

$17,006

$19,472

$30,383

$39,654

Interest on outlay

$799

$915

$1,428

$1,864

Capital Cost (Outlay + Interest)

$17,805

$20,387

$31,811

$41,518

Depreciation at third year

$2,719

$3,635

$4,725

$7,078

Depreciation Value

$13,273

$14,750

$24,560

$31,151

Total Fixed Costs

$4,532

$5,637

$7,251

$10,367

Fixed Costs per Day

$12.42

$15.44

$19.87

$28.40

FLEXIBLE COSTS
Petrol - Litres used per 100km

6.4

7.54

8.95

11.17

Litres used over 14,000km

896

1055.6

1253

1564

Cost of fuel annually at $2.10/litre

$1,881.60

$2,216.76

$2,631.30

$3,284.40

Cost of oil

$79.33

$79.33

$79.33

$79.33

Tyres cost per year

$321.03

$379.71

$473.59

$695.00

Repairs and Maintenance

$596.84

$633.82

$635.35

650.47

Total Running Costs

$2,878.80

$3,309.62

$3,819.57

$4,709.20

Flexible (Running) Cost per Kilometre

20.6

23.6

27.3

33.2

FIXED COST + FLEXIBLE COST = OPERATING COST =

$7,410.88

$8,946.71

$11,070.59

$15,076.26

OPERATING COST in CENTS PER KM

52.9

63.9

79.1

107.7

Previous year

52.7

63.1

78.1

106.3

Percentage difference over last year

0.4%

1.3%

1.25%

1.31%

Overall costs have decreased by

1.1%

Expanded usage from 5,000km - 30,000km per year

Petrol Vehicles

Small

Compact

Medium

Large

Total kilometres driven per year

Cents/km

Cents/km

Cents/km

Cents/km

5,000km

108.11

133.06

168.95

237.38

6,000km

99.43

122.17

154.71

216.87

7,000km

90.76

111.28

140.47

196.37

8,000km

82.08

100.40

126.23

175.86

9,000km

73.41

89.51

111.99

155.36

10,000km

64.73

78.62

97.75

134.85

11,000km

61.88

75.08

93.26

128.37

12,000km

59.03

71.54

88.78

121.89

13,000km

56.19

68.00

84.29

115.40

14,000km

52.90

63.90

79.10

107.70

15,000km

50.49

60.92

75.32

102.44

16,000km

48.99

59.04

72.90

98.99

17,000km

47.48

57.16

70.49

95.55

18,000km

45.98

55.27

68.07

92.10

19,000km

44.47

53.39

65.66

88.66

20,000km

42.97

51.51

63.24

85.21

21,000km

42.26

50.63

62.09

83.52

22,000km

41.54

49.74

60.95

81.83

23,000km

40.83

48.86

59.80

80.15

24,000km

40.12

47.97

58.66

78.46

25,000km

39.41

47.09

57.51

76.77

26,000km

38.69

46.20

56.36

75.08

27,000km

37.98

45.32

55.22

73.39

28,000km

37.27

44.43

54.07

71.71

29,000km

36.55

43.55

52.93

70.02

30,000km

35.84

42.66

51.78

68.33