Go Back   Team-BHP > BHP India > The Indian Car Scene


Reply
 
Thread Tools Search this Thread
Old 24th March 2011, 09:44   #16
BHPian
 
Join Date: Mar 2011
Location: Mumbai
Posts: 262
Thanked: 108 Times
Default Re: Average annual maintenance cost

Indica Vista (Qdj).
September 2010.
8200 KM.
Completed two services.
Maintenance cost: ZILCH
Next service at 10K
Dont expect much (touch wood) other than the cost of engine oil change.
@Chaand is offline   Reply With Quote
Old 24th March 2011, 10:08   #17
BHPian
 
Join Date: Jan 2009
Location: Bangalore
Posts: 162
Thanked: 23 Times
Default Re: Average annual maintenance cost

Guys I had done some excel crunching to come up the real per km cost (All inclusive, including opportunity cost of capital) for cars from various segments. Take a look and let me know your comments (Of course feel free to change the assumptions as per your judgment and the model will take that into account). Some results are a total revelation - the cost of owning and driving something like a BMW X1 is almost Rs 70 per km, while it is around Rs 35 for a Cruze and only Rs 15 for something like a Petrol Ritz.

Food for thought!
Attached Files
File Type: xlsx Car Ownership Cost.xlsx (14.4 KB, 1883 views)
skjlives is offline   Reply With Quote
Old 24th March 2011, 10:48   #18
BHPian
 
CoolFire's Avatar
 
Join Date: Sep 2009
Location: Trichur, Kerala
Posts: 261
Thanked: 106 Times
Default Re: Average annual maintenance cost

skjlives, good work. But IMHO, a fundamental change is needed in the calculations.

you seem to have taken the interest and opportunity costs on the initial value of the vehicle. Along with this you are deducting depreciation every year. So you are effectively writing off capital and then charging interest even on that written off capital.

The correct method will be to reduce interest charges yearly. To make it simpler, just take the average of purchase price and resale value and charge interest on that. This will make the costs significantly lesser.

Last edited by CoolFire : 24th March 2011 at 10:50.
CoolFire is offline   Reply With Quote
Old 24th March 2011, 11:08   #19
BHPian
 
Join Date: Jan 2009
Location: Bangalore
Posts: 162
Thanked: 23 Times
Default Re: Average annual maintenance cost

Quote:
Originally Posted by CoolFire View Post
skjlives, good work. But IMHO, a fundamental change is needed in the calculations.

you seem to have taken the interest and opportunity costs on the initial value of the vehicle. Along with this you are deducting depreciation every year. So you are effectively writing off capital and then charging interest even on that written off capital.

The correct method will be to reduce interest charges yearly. To make it simpler, just take the average of purchase price and resale value and charge interest on that. This will make the costs significantly lesser.
I agree that the opportunity cost of the capital that you pay upfront is only a notional or theoretical cost, but the way I am looking at it is what would a car cost me to own, all things included Vs if I don't buy it (and walk ), in which case I can put the DP amount in an FD (at worst) and get 6% post tax.

On the point about writing off capital and charging interest on it too - Isn't that the reality? You pay interest on the full amount of the car (bar the DP amount) while that full amount is actually getting depreciated every year. It does sound like a double whammy and the fact is, it is a double whammy!
skjlives is offline   Reply With Quote
Old 24th March 2011, 11:10   #20
dot
Senior - BHPian
 
dot's Avatar
 
Join Date: Dec 2007
Location: Ban Chang
Posts: 1,681
Thanked: 714 Times
Default Re: Average annual maintenance cost

@skjlives, very interesting comparison. Shows a pretty real world picture of ownership cost.

@Coolfire, regardless of how @skjlives has calculated depreciation, the resale values are pretty much bang on target. So the final calculations may be very close to reality.
dot is offline   Reply With Quote
Old 25th March 2011, 09:53   #21
BHPian
 
CoolFire's Avatar
 
Join Date: Sep 2009
Location: Trichur, Kerala
Posts: 261
Thanked: 106 Times
Default Re: Average annual maintenance cost

Quote:
Originally Posted by skjlives View Post
I agree that the opportunity cost of the capital that you pay upfront is only a notional or theoretical cost, but the way I am looking at it is what would a car cost me to own, all things included Vs if I don't buy it (and walk ), in which case I can put the DP amount in an FD (at worst) and get 6% post tax.

On the point about writing off capital and charging interest on it too - Isn't that the reality? You pay interest on the full amount of the car (bar the DP amount) while that full amount is actually getting depreciated every year. It does sound like a double whammy and the fact is, it is a double whammy!
I didn't mean to differ with you on charging opportunity cost. My only concern was it being charged on the depreciation element also. In fact, as you hinted I would take it at an even higher rate - maybe 8% currently.

But on charging of interest, if you have taken a loan for the exact period of holding, you will be paying back the capital as EMIs and the interest cost will come down, won't it? That will be even more than the depreciation fall. But you have to assume the cost of capital of repayment also.

All in all I still feel the best way will be to take interest or opportunity cost on the average value of car during holding period. ie. (Purchase price + Resale value)/2

Last edited by CoolFire : 25th March 2011 at 09:56.
CoolFire is offline   Reply With Quote
Old 25th March 2011, 10:03   #22
Senior - BHPian
 
vasoo's Avatar
 
Join Date: Jul 2007
Location: Memphis TN
Posts: 1,031
Thanked: 207 Times
Default Re: Average annual maintenance cost

Good job skjlives. However I think the yearly maintenance charges ( I believe you meant the service costs here) are exaggerated. For example, First year maintenance for most cars are quite minimal at around 1-3k for most cars. And then onwards it will not be more than 5-10k even for C+ segment cars such as Altis or Civic. Insurance renewal cost is also pretty high. It should not be more than 10-15k per annum ob average.
vasoo is offline   Reply With Quote
Old 25th March 2011, 12:08   #23
Senior - BHPian
 
neoonwheels's Avatar
 
Join Date: Aug 2005
Location: Pune
Posts: 1,651
Thanked: 599 Times
Default Re: Average annual maintenance cost

Quote:
Originally Posted by scuderiamania View Post
That seems to be on the higher side. Can you please provide us with a break-up?
Please check out my ownership thread "Every P has its story). It has everything.
neoonwheels is offline   Reply With Quote
Old 25th March 2011, 12:24   #24
BHPian
 
avisidhu's Avatar
 
Join Date: Dec 2010
Location: Chandigarh
Posts: 618
Thanked: 456 Times
Default Re: Average annual maintenance cost

Quote:
Originally Posted by vasoo View Post
Good job skjlives. However I think the yearly maintenance charges ( I believe you meant the service costs here) are exaggerated. For example, First year maintenance for most cars are quite minimal at around 1-3k for most cars. And then onwards it will not be more than 5-10k even for C+ segment cars such as Altis or Civic. Insurance renewal cost is also pretty high. It should not be more than 10-15k per annum ob average.
Precisely. Can you please elaborate a bit on why the maintenance charges have been documented so high(more so since you are assuming a car drives only around 50K KMs during these four years)?
avisidhu is offline   Reply With Quote
Old 25th March 2011, 13:24   #25
Senior - BHPian
 
Gansan's Avatar
 
Join Date: May 2009
Location: Chennai
Posts: 3,427
Thanked: 875 Times
Default Re: Average annual maintenance cost

Ideally, service costs after completion of two years from the date of purchase alone should be posted. This is when the real maintenance costs get reflected. For Spark, I would like to know the cost from someone who has completed the three year free maintenance period.
Gansan is offline   Reply With Quote
Old 25th March 2011, 14:13   #26
BHPian
 
Join Date: Feb 2009
Location: Sydney
Posts: 220
Thanked: 23 Times
Default Re: Average annual maintenance cost

Useful thread.

For my car
Model: Alto LXI
Bought: Dec, 2008
Last 1 year expenses
Servicing - 7700
Fuel - Rs.2600 a month

Insurance costs excluded

Last edited by travelwriter : 25th March 2011 at 14:14. Reason: Insurance costs
travelwriter is offline   Reply With Quote
Old 25th March 2011, 14:59   #27
ACM
Distinguished - BHPian
 
ACM's Avatar
 
Join Date: Mar 2008
Location: Mumbai
Posts: 4,152
Thanked: 2,457 Times
Default Re: Average annual maintenance cost

I feel that this is an incorrect question.

Maintenance costs have to depend upon not just the time but also (mainly) the usage. (Kms). There can be no such thing as AMC for cars, it has to depend upto the kms run.

A car run for 10,000 kms a year and one run for 60,000 a year cannot have the same or even similar maintenance costs. And every one really has a different usage patter as well. City driving, rural driving and highway driving all result in difference in cost, besides it is also about the condition in which one wishes to keep the car. Most taxi drivers keeps the car just about running and other aspects do not matter to them, while a certain private owner can maintain his car like taxi driver or like a (Parsi / Doc / Car Fan - people who are reputed to take good care of cars).

Also how one drives the car (agressive and fast with high revs and flying over and off potholes and speed breakers) or one who slows down for even the most minute cracks on the road matters.
ACM is offline   Reply With Quote
Old 25th March 2011, 15:10   #28
Senior - BHPian
 
aniketi's Avatar
 
Join Date: Sep 2009
Location: Pune
Posts: 1,270
Thanked: 711 Times
Default Re: Average annual maintenance cost

Swift Dzire Petrol:

Model July 2009
Running: 13500 Till date
Service costs: 1350 + 180 + 810 (1st, 2nd & 3rd Servicing) Total = Rs. 2340

My running is on lesser side as i don't use it daily for office. But till date i am very satisfied with the car. No issues at all. Maruti is amongst the best vehicles to maintain. High reliability and low service + repair costs. This is our fourth Maruti in our family. All previous ones are also very easy & cheap to maintain
aniketi is offline   Reply With Quote
Old 25th March 2011, 15:27   #29
Team-BHP Support
 
Rudra Sen's Avatar
 
Join Date: Apr 2004
Location: Bangalore
Posts: 10,404
Thanked: 4,092 Times
Default Re: Average annual maintenance cost

Quote:
Originally Posted by ACM View Post
Maintenance costs have to depend upon not just the time but also (mainly) the usage. (Kms). There can be no such thing as AMC for cars, it has to depend upto the kms run.
Spot on!
Quote:
Originally Posted by ACM
Also how one drives the car (agressive and fast with high revs and flying over and off potholes and speed breakers) or one who slows down for even the most minute cracks on the road matters.
This I believe is the main point. And point in case is my Optra.

Bought:2004 March

Expenses till date:

Front right parking light bulb 73.60 (inclusive of tax and labour)

Security alarm switch under hood 342.00 (inclusive of tax and labour)

Front right shock absorber 3655.00 (inclusive of tax and labour)

O2 sensor 8303.00 (inclusive of tax and labour)

Brake replacement job - 16977.00 (inclusive of tax and labour)
Note: This cost is for changing front disks/pads and rear shoes

Not taking bumps and nicks repair here.
Rudra Sen is offline   Reply With Quote
Old 26th March 2011, 08:36   #30
BHPian
 
Join Date: Jan 2009
Location: Bangalore
Posts: 162
Thanked: 23 Times
Default Re: Average annual maintenance cost

Quote:
Originally Posted by avisidhu View Post
Precisely. Can you please elaborate a bit on why the maintenance charges have been documented so high(more so since you are assuming a car drives only around 50K KMs during these four years)?
Idea was to present a template to nail down the "complete" cost of owning cars across segments and not to accurately predict specific cost heads. For instance, even if you drive 10 k kms in a year, your maintenance cost will be different from another driver doing the same - Dings and dents are a reality of life and we all know they cost a bomb to iron out and refurbish. Some silly bugger will always give you that parking scratch which you may ignore for a few weeks but will eventually get repainted/polished depending on how much it bothers you or not. That stupid biker will always out-brake himself (and find himself in your rear seats occasionally), which could sometimes mean that either you beat him down into paying the damage (which he usually can't) or take it on the chin and pay for that bumper repair or potentially a new set of headlamp cluster.

In short, maintenance for me includes regular/preventive, but also accident/incident and clearly costs are widely different (compare a Fabia's headlamp cluster cost to a swift's). But in any case, feel free to consider my numbers as placeholders for assumptions and do your math according to your best estimates on maintenance/insurance/fuel/mileage etc.
skjlives is offline   Reply With Quote
Reply


Thread Tools Search this Thread
Search this Thread:

Advanced Search


Similar Threads
Thread Thread Starter Forum Replies Last Post
Tata Motors Annual-Maintenance-Contract: Reviews? greenhorn The Indian Car Scene 42 26th April 2017 12:13
TATA Safari TCIC Maintenance Cost ibm_jennifer Long-Term Ownership Reviews 90 16th October 2011 14:10
Maintenance cost - Maruti 800 Carb and MPFI models vinfriend Technical Stuff 9 17th November 2009 12:16
Fiesta 3rd service average cost calvinkrishy Indian Car Dealerships 16 21st March 2008 21:20


All times are GMT +5.5. The time now is 10:26.

Copyright 2000 - 2017, Team-BHP.com
Proudly powered by E2E Networks