Cheaper car loans fail to offset rising transport costs
Australia’s transport costs were up over the 2017 December quarter, with rises to the cost of fuel, tolls and insurance outpacing falls in the cost of car loans, servicing and registration, according to the Australian Automobile Association (AAA).
According to the AAA December 2017 Transport Affordability Index, the average Australian metropolitan household’s transport spending over the quarter rose by $121 to $17,606, accounting for 14.2% of household income. Regional households were found to have seen their transport costs rise by $125 to $14,008, accounting for 12.3% of household income.
Overall, the transport costs that increased over the quarter included:
- Fuel prices
- Comprehensive insurance
- Toll costs
Costs that decreased over the quarter included:
- Car loan payments
- Registration, CTP and licensing fees
- Servicing of the old vehicle and tyres for both vehicles
While car loan payments across Australia dropped slightly over the December 2017 quarter, they still remained the number one highest-priced transport expense for both metro and regional households. Melbourne and Geelong were found to be the most expensive metro and regional centres in terms of car loan costs (despite a large decrease in Melbourne), while the cheapest car loan payments were found in Hobart and Launceston.
Only Sydney, Wagga Wagga and Hobart recorded decreases in overall transport costs for the December 2017 quarter, by $58, $80 and $24 respectively. Despite this decrease, Sydney remained the most expensive capital city in Australia in terms of total dollars at $22,291 per year.
AAA chief executive, Michael Bradley, described the impact of transport on the cost of living as being “frequently overlooked” compared to utilities such as electricity:
“Unlike utility bills, Australian families do not receive all-encompassing transport bills every three months. The index highlights subtle movements in transport costs, which are otherwise easy to overlook.”
Total annual household transport costs
| City | Q3 | Q4 | Change |
|---|---|---|---|
| Sydney | $22,349.84 | $22,291.81 | -$58.03 |
| Melbourne | $19,306.85 | $19,461.26 | $154.41 |
| Brisbane | $19,066.86 | $19,312.22 | $245.36 |
| Perth | $17,022.71 | $17,218.64 | $195.93 |
| Adelaide | $15,404.80 | $15,624.97 | $220.17 |
| Hobart | $15,001.63 | $14,977.64 | -$23.98 |
| Darwin | $15,288.65 | $15,372.69 | $84.04 |
| Canberra | $16,439.78 | $16,589.75 | $149.97 |
| Capital Average | $17,485.14 | $17,606.12 | $120.98 |
| Wagga Wagga | $13,015.16 | $12,934.94 | -$80.22 |
| Geelong | $14,839.34 | $15,005.69 | $166.35 |
| Townsville | $12,865.04 | $13,038.05 | $173.01 |
| Bunbury | $14,797.14 | $14,920.99 | $123.85 |
| Mount Gambier | $13,419.79 | $13,743.69 | $323.89 |
| Launceston | $13,675.84 | $13,717.05 | $41.21 |
| Alice Springs | $14,568.66 | $14,692.93 | $124.27 |
| Regional Average | $13,883.00 | $14,007.62 | $124.62 |
Source: AAA
Disclaimer
This article is over two years old, last updated on February 19, 2018. While RateCity makes best efforts to update every important article regularly, the information in this piece may not be as relevant as it once was. Alternatively, please consider checking recent car loans articles.
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