Cash-strapped motorists fail to understand true cost of car ownership You Gov survey on attitudes to car ownership for Europcar finds motorists making short-term cost savings which could lead to longer term financial pain
Increasing motoring costs and the fuel price hikes we have seen this year are changing how we drive our cars in the UK but ignorance of the real cost of motoring could lead to longer term financial pain for car owners. These are the conclusions of new research on attitudes to car ownership conducted by You Gov Plc for Europcar UK Group, the UKs leading vehicle rental organisation.
1 in 3 drivers (34%) now think that people are trapped into car ownership by their location, work and family commitments. And, around 1 in 4 thinks that the cost of ownership outweighs the benefits. Yet, only 8% had any real idea of the true cost of running a car. 76% underestimated the cost and almost 1 in 5 (18%) simply had no idea. Even assuming respondents to the survey were guessing the figure based purely on the cost of keeping a car on the road (£2,435*), only 10% estimated within the right parameters.
Tim Bailey, Fleet Director for Europcar UK Group says: The invention of the car brought us freedom and flexibility but over a third of drivers say motorists feel trapped into car ownership. With respondents from two car households making up 37% of the sample, the research suggests that, in the pursuit of short-term cost cutting measures, drivers could be missing the bigger picture because they dont have a clear understanding of the true costs of running one or two cars.
In a bid to cut costs, 68% of drivers have cut the number of journeys they are making and 46% have changed the way they drive to conserve fuel. Plus motorists are cutting costs for servicing, maintenance and roadside assistance. But this could have serious implications for their safety and could also affect re-sale values which will be a particular concern for the 25% that said they have decided not to replace their car this year.
Respondents to the survey said that the feeling of being trapped into car ownership was due to where they lived (79%) followed by work (74%) and family commitments (55%). Over 1 in 5 (27%) put it down to peer pressure.
And, while 76% have taken action to reduce the cost of car ownership only 3% have taken the ultimate measure – to give up the one of the household cars.
Tim Bailey continues: Households with more than one car are particularly hard hit by rising costs. But the reality is that public transport is not providing the solution and the British mindset has not yet moved to seeing rental as a viable alternative.
However, at Europcar, we are starting to see more people renting for day to day needs and as an alternative to second car ownership. When you look at the figures, 54% of the cost of running a car is fuel and over 70% of that cost is fuel tax and VAT. By renting a car you can eliminate all the other costs – insurance, maintenance and roadside assistance and also reduce fuel consumption by as much as a third by driving a nearly new car in a more efficient way.
Its a trend we think will grow as the cost of running cars fuel, insurance, etc – eats into already stretched household budgets. In fact the survey showed that 23% have either used or are considering using car rental as an alternative to car ownership.
John Lynch of Walton on Thames took the decision last year to give up his car, after 27 years of ownership
John says: Like most people, I have always had a car and just lived with the expense I assumed I couldnt do without it and actually never gave it a great deal of thought. However, last year my car (which was a BMW Touring) needed some major work. When I found out that the cost of the work was more than the value of the car itself, my immediate response was that I would either just have to grin and bear it or buy a new car. Both options were going to be costly and I really resented it. We were just about to move home with all the expense that entailed, so I started to think about how much I actually needed a car on a day to day basis could I actually survive without a car and did I actually want to? I commute into work each day the train station is just a walk away, I am a keen cyclist and my partner has a company car we could share at the weekend.
So I took the plunge and while I dont think we could manage without at least one car in the household, giving up the second car has actually been quite liberating. At first the thought of not having a set of car keys to grab at a moments notice was a bit scary but I think you can get quite lazy and don’t realise that you can cope quite easily without a car full time.
Now I just rent from Europcar when I need a car its proved so much simpler and I have saved in the region of £2,000 a year in the process.
The findings of the You Gov Plc survey in the UK contrasts with the forthcoming release from Europcar International of The Europcar Transportation & Mobility Observatory a study of European drivers. This found that our counterparts on the continent are much more ready to give up their cars. In the survey 18% of Europeans said they are ready to do without their cars and 26% of those surveyed believe travel would cost less if they didnt have a car.
While recent research from insurer esure** suggests nearly half of all motorists are considering downscaling to one vehicle per household, its up to organisations such as ours to ensure motorists have alternatives to consider that will not only save costs but provide a solution that is safe and reliable.
Certainly at Europcar we are addressing the move towards less reliance on car ownership with new services such as delivery and collection and hourly rentals plus were looking at ways to streamline the rental process to make it much more transparent and easy to use, concludes Tim Bailey.
Key Statistics of respondents who own/use a car·
· More than 1 in 3 people (34%) think we are trapped into car ownership.
· Around 1 in 4 (26%) think that the cost of car ownership outweighs the benefits.
· Almost 1 in 5 has absolutely no idea about how much it costs to run a car – only 8% correctly estimated the annual running cost of owning a new car.
· In a bid to cut costs, I in 4 has decided not to change their car this year, 16% have cut costs in terms of servicing, maintenance (14%) and/or roadside assistance (11%)
· 68% are using their car less frequently and almost half (46%) have changed the way they drive to conserve fuel
· Over 1 in 5 (23%) have either used or are considering using car rental as an alternative to ownership
The You Gov survey commissioned by Europcar UK Group was conducted between 23rd and 25th September 2008. 1,563 UK Adults who own or use a car were surveyed a representative sample of all
*Based on research by RAC Cost of Motoring Index 2008.
** esure press release 3/10/08 UK set to become nation of one car households.
Notes to Editors
Owned by the French private equity firm Eurazeo, Europcar is the European leader in passenger car and light utility vehicle rentals. Since March 2007 with the acquisition of Vanguard EMEA (National & Alamo brands), its network comprises over 5,300 rental outlets in 160 countries. Europcar serves business and leisure customers throughout Europe, Africa, the Middle East, Latin America and the Asia-Pacific region. Excluding franchise operations, in 2007 Europcar signed more than 10 million rental contracts, with 7,700 employees and a fleet exceeding 215,000 vehicles. For more information: www.europcar.com
For further press information please contact Maddy Roles, Elinor Puzey, Dominic Dennis or Jenny Staniforth at HSL, Churcham House, 1 Bridgeman Road, Teddington, Middlesex, TW11 9AJ. Telephone: 020 8977 9132 Fax: 020 8977 5200. Email: firstname.lastname@example.org
Please see attached graphs. yougov-graphs.pdf