2018: one of the toughest years

While transport companies are fighting to move forward against a headwind of rising costs and overheads, the average motorist is having to shell out more, too. According to the latest data from WesBank, the average costs of motoring have increased by approximately R940, or 14 percent, in the last year, and 31 percent since 2013.

Despite prevailing interest rates remaining at low levels and favourable vehicle price inflation, the rising cost of fuel and an increase in VAT from 14 to 15 percent have resulted in higher overall costs when looking at the total monthly cost of motoring. Vehicle instalments and fuel spend remain the biggest components, accounting for 80 percent of monthly mobility spend.

These costs are reflected by the WesBank Mobility Calculator, a tool the bank uses to track and calculate historic motoring costs.

“The past year has been a rollercoaster ride with drastic fuel price fluctuations making it difficult for consumers to keep track of monthly budgets,” says Ghana Msibi, executive head of sales and marketing, WesBank. “As a rule, we generally advise motorists to allow some breathing room in their budgets to help absorb these changing costs.”

WesBank’s data also indicates that the change in vehicle price inflation for new vehicles has had a favourable effect on purchase prices. In July this year, WesBank’s average new-vehicle financed deal was only 1,43-percent higher than the same time last year at R307 445, while the average used vehicle finance deal is 6,9-percent higher than that of 2017, at R216 309.

“International oil prices and local exchange rates continue to play a direct role in the monthly budgets for motorists, in both fuel and vehicle prices,” says Msibi. “Although manufacturers are offering attractive marketing incentives to lure customers into dealerships, consumers still have to spend more on vehicles, fuel, insurance and maintenance than ever before.”