[@Chaand]

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.

[skjlives]

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!

[CoolFire]

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.

[skjlives]

Originally Posted by CoolFire

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!

[dot]

@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.

[CoolFire]

Originally Posted by skjlives

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

[vasoo]

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.

[neoonwheels]

Originally Posted by scuderiamania

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.

[avisidhu]

Originally Posted by vasoo

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)?

[Gansan]

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.

[travelwriter]

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

[ACM]

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.

[aniketi]

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

[Rudra Sen]

Originally Posted by ACM

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!

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.

[skjlives]

Originally Posted by avisidhu

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.