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Re: Cost per mile driven
John Greenstreet wrote:
> [...] Heck, in New Jersey, it's
> fairly average to have insurance alone account for 20 cents per mile.
> To get to 10 cents/mile depreciation-wise, you'd have to drive a
> $20,000 car 200,000 miles. Add in the opportunity cost of the car's
> equity, tyres, maintenance, fuel, oil, washing, waxing, etc. and the
> cost per mile of even an average car is well over 40 cents per mile
> if driven the average of 15 K miles/year.
Here's my calculation for the 1990 Golf GTI 16V which I bought new, and
sold at a little over 4 years of age (and 75,000 km) a few months ago:
Depreciation 12.0 c/km
Insurance 4.0 c/km
Maintenance 2.5 c/km
Tires 1.5 c/km
Fuel and oil 5.5 c/km
Total 25.5 c/km
After conversion to miles and US$, that works out to 29.1 cents per mile.
And gasoline is more expensive here -- US$1.65 per gallon of premium.
> Analyses that come up with a cost per mile of much less than 40 cents
> are probably omitting something, or looking at too short of a time
> period; e.g., the car's tyres may need replacement but that cost is not
> added in, or similarly with other wear items. Remember that all a car's
> wear items need to be depreciated as well as the car itself.
The GTI was reliable, and at ~US$16,000 (new) not the most expensive
car, but it wasn't a beater, either. The tire costs are based on 40,000
km (25,000 miles) per set of Comp T/As or other comparable tires. But
if you're looking at a $30K+ car (such as an Audi 100), 40 cents is much
Our company currently pays 30 cents per km in mileage, and considering that
I already have my car (and thus it's depreciating anyway, whether I drive
it for work or not), that works out to be a pretty good deal for me.
[ /tom haapanen -- firstname.lastname@example.org -- software metrics inc -- waterloo, ont ]
[ "you ain't goin' nowhere, son" -- grand ole opry manager to elvis, 1954 ]