When people think of buying a car in the Philippines, more often than not, they only think of the cost of the actual vehicle and conveniently forget about other necessary expenses. As a consequence, they become blind to the huge financial responsibility that is owning a car and find themselves searching for more money every time bills and payments come in. To give you a little heads up, the cost of owning a car is far from buying a replacement muffler for sale in the Philippines.
As much as we’d like to avoid having to do calculations, it’s unavoidable if we want to make people realize just how much it costs to own a car in the Philippines. If you want the actual numbers, simply continue reading as we list down the expenses you need to shoulder once you own a car and how much they’re going to cost you on a yearly basis.
Actual Vehicle Cost
The cheapest available vehicle in the Philippines at the moment is priced at around ₱400,000 and fits four people at most. You can find other cars under ₱500,000 and they’re acceptable modes of transportation that don’t break the bank, however they may not be suitable for people who have large families.
If we were to stop here, like most people do, owning a car suddenly doesn’t seem like much of a financial responsibility. Unfortunately, we’re still in the first item and have 5 more to consider.
LTO Registration and Renewal
Now, having your car registered doesn’t cost much, but it’s better to include it in the list so that we end up with the most accurate figure possible. Registration is required after purchase of the vehicle and lasts for three years. After that, you have to go for a renewal, which is much cheaper.
On average, though, expect to spend somewhere between ₱1,500 to ₱2,000 for registration and renewal fees.
Fuel expenses take up a huge chunk of a car owner’s budget. Due to insane inflation rates, average gasoline price is now at ₱50 per liter while average diesel price is at ₱40 per liter. Annual fuel expenses vary depending on what you drive and how much fuel it uses but an accurate and generous average would be ₱40,000.
That’s actually only enough for a sedan but we’re going for the bare minimum here, so that should fit in well in our list.
This one’s a little harder to calculate because not everyone uses paid parking spots. Additionally, there’re fixed parking fees and ones that increase by the hour. We’ll try to be as accurate as possible, though, so stick with us here.
People can spend anywhere from ₱50 to ₱150 daily on parking alone. Assuming they do this due to work, we can multiply that with 20 – number of working days in a month – and again by 12 – number of months in a year. We’d then arrive at a minimum of ₱12,000 for annual parking costs – not that bad, right?
Car insurance is required under the law and although not everyone avails of it, we’re assuming that you’re an upstanding citizen that does. Car insurance policies can cost anywhere from ₱10,000 to ₱20,000 yearly. That may seem like a lot, but you have to take into account that it actually protects you from any additional expenses in the event something unfortunate happens.
Repairs and Maintenance
Here’s another variable that doesn’t actually cost much – repairs and maintenance. Vehicles undergo preventive maintenance and other services like oil changes every 5,000 kilometers that they punch in. Costs depend on the vehicle brand, model, and type but it’s safe to put the annual average cost at ₱5,000.
That isn’t much, but keep in mind that this number is for a fairly new car that is properly maintained and used. You can expect this to go higher the older the car is and the worse of a driver you are.
Adding up all these costs, we arrive at ₱468,500 and this is the cost of owning a new vehicle for the first year. Assuming you’ve fully paid for the vehicle on that year, we can subtract ₱400,000 which is the actual cost of buying the vehicle. That leaves us with ₱68,500 – a somewhat accurate calculation of how much you have to spend annually to own a car in the Philippines. It may not be as much as what you had in mind but it’s certainly a gigantic number when compared to buying a muffler for sale in the Philippines.
You still have to keep in mind, though, that this is the extreme minimum and only applicable for a single person who drives a sedan only to and from work without going through tolls, properly takes care of the vehicle, uses fixed parking, and bought the cheapest car insurance policy available.