4 Essential Questions About Saving On Your New Car Answered

By BankBazaar | June 5, 2015

Car

To car or not to car, was answered for Shivkumar once he got a taste of Kochi’s summer showers for the first time. It was no fun arriving at work sopping wet and spending a day in the AC. Aachoo!
While the rest of the world wondered whether Kanye West and Kim Kardashian’s new baby would be named South West, Shiv asked an auto consultant all the right questions about buying a new car.

Petrol or diesel?

“What’s the distance you might travel in a month?” asked the consultant.
“Roughly 2,500 kms”, replied Shiv.
“Then go for a diesel car”. Obviously there was no confusion in the expert’s mind.
“Why not a petrol car?”, Shiv quipped.

The petrol cars might be cheaper than the diesel versions by around Rs1.5 lakh, but consider this: If you buy a Honda Amaze, the high-end petrol version may cost you Rs 8,07,000 and the diesel one Rs 9,05,000. But for the petrol version you would get a mileage of 18km/litre while a diesel car would give you 25 km/litre. There diesel car scores.

Although the maintenance cost for diesel cars would be roughly Rs 3,500 per month compared to Rs 1,500 per month for the petrol version. .
Despite that, if you clock 24,000 kms per year, the running cost on a diesel car would be around Rs 98,217 with a fuel bill of Rs 56, 217. While your annual petrol bill would be Rs 99,175 and the total running cost, including the maintenance cost, would be around Rs 1,171, 175. A little bit of math solves that problem.

You save close to Rs 18,958 on your diesel car and the price premium of Rs 1, 02,000 you paid for the diesel car could be recouped in few years.
The Diesel car is the best option for longer distances.

New car or used car?

You can definitely save by buying a used car. That’s for sure. Depreciation on car can give anyone nightmares. With each km there is a dip in value. The decline is quite higher in the first year as some models may lose close to 25%.

In your case, Shiv, if you buy a one-year-old ‘used new’ Honda Amaze diesel version, which has clocked 30,000 kms for about Rs 7,15,000, you can save Rs1,85,000.

You also get to drive a better model at lesser price.
“But if you have any plans to take a loan for a used car, the rate of interest would be higher”, warned the consultant.

When to buy a car?

December is the time the car companies come up with a plethora of discounts to clear the stocks in order to hike prices and launch new models the next year. You can cash in on the freebies, but there is a problem.

The car papers would show the previous year’s registration. This means your car is an older model in just a month. If you sell the car after four years or so, it would fetch a much lesser resale value.
“Shiv, keep this in mind, a new car should be used for at least eight years to get full return on investment. Sell early and lose more”.

How to save on fuel?

Speed thrills, kills and increases your fuel bills too. The harder you press the accelerator, the more the fuel consumed. So driving at 50 to 60 kms per hour is ideal for fuel economy.

It is also necessary to accelerate sensibly. Don’t try to test 0 to 100 km in 10 sec tagline on your car. Otherwise, you have a gas guzzler on your hands. Accelerate as if you are lifting a baby from the cradle. It should be smooth. Those who rev and zoom away as soon as the signal turns green not only end up right at the next signal, but lose out on a significant amount of fuel as well.

Once in a while, try to wind down the windows and enjoy the natural breeze. Shutting off the air conditioner can roll back your fuel bills. Avoid unnecessary idling during traffic jams, we all know it’s getting nowhere any time soon.

Take good care of the tyres. Air pressure is critical because under-inflated tyres make your engine work harder and that results in more fuel consumption. Less air pressure in the tyres also means more rolling friction and puts more burden on the engine too.
New tyres have a better grip and virtually glide through the roads with less torque on the engine.
You can feel the crunch on the gravel, or the pot hole, easily.

Changing tyres at the right time would also increase fuel efficiency by about 5%.

How to cut down on maintenance charges?

The best way to reduce maintenance charges is to service your car regularly. Above all make sure that you bought a reliable vehicle which doesn’t give you any heartburn. Also make sure that engine oil is changed regularly, air filters are clean and wheels are aligned with alacrity. These simple things can cut down the maintenance charge drastically.

Taking good care of your car may ensure you a smoothly running car and save you oodles of cash in the process, but we make no promises about the conditions of our roads, the cows you might have to avoid, the sudden pile-ups, and the cricket ball that cracked your windshield.

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