Category Archives: Uncategorized

How far you can drive for cheap fuel before it costs you

How far can you drive before saving money filling up costs you?If you go out of your way to find that fuel bargain, you won’t be alone. But how far can you travel before the hunt for the holy grail of cheap petrol or diesel starts to cost you? Fuel cost comparison website claims the lowest price for regular unleaded in my area is £1.22 a litre. The average is £1.25. Assuming a £45 fill up, I’d get 36.88 litres from the cheaper outlet, 36 litres at the average priced one. That’s a difference of 0.193 of a gallon, or in a 45mpg car, 8.68 miles.

So I could go just under nine miles out of my way before it starts costing more than it’s going to save me. Of course, the more economical my car, and the greater the cost differential, the more miles I can drive. I have nine fuel stations within five miles of my house, so chances are, picking the cheapest should save me money. The amount, however, is disappointingly low. If I’m covering 10,000 miles a year in my 45mpg car, the difference between £1.22 per litre and £1.25 is only £30.30 over 12 months. Still, I’d rather that was in my pocket than a fuel station’s till.

When buying new is cheaper than used – it’s all because of depreciation

Looks wild, depreciates even more wildly when it's bought as a new car (Picture  © BMW)

Looks wild, depreciates even more wildly when it’s bought as a new car (Picture © BMW)

Popular opinion among bar-leaning soothsayers is that used cars are always cheaper to buy and own than new. The simple logic is that the depreciation curve is at its steepest in year one and flattens off thereafter. However, CAP Automotive has given me the figures to bust the myth that you’re wasting money by buying a car from new.

The cost of running a car is split multiple ways. Many factors stay the same year in, year out when it comes to working out a cost of ownership. It doesn’t matter what car you run, if we’re talking like for like in terms of mileage, engine, specification and driver, the cost of fuel will be the same whether that car is brand new or one-year old.

Servicing and maintenance costs, however, will be lower in the first year of ownership than in year two because the car is likely to need a more extensive service in its second year. In three years on a car that’s been bought new, you’ll just have a single expensive service, in year two. If that car was bought as a one-year-old, over three years you’ll have the two expensive services of years two and four. And that can be a significant cost. Keeping a VW Up! fettled for three years will cost £848 if it’s bought new, £1183 if it’s acquired at one-year old.

Then we come to depreciation. Some cars cling to their value so enthusiastically that they’re actually more expensive to buy second hand than they are new, assuming 12,000 miles a year. Take the Range Rover Sport. Buy it new and it’ll cost you £59,465. Buy a one-year old car and CAP claims its value to be £58,250. “If a car holds its value like this, you’d be better off buying it new,” CAP consumer specialist Philip Nothard said. Extrapolate that over three years and the figures show that you’d actually be £2677 better off. “You’d be daft to buy it used,” he added. “At the moment it really is a new car market.”

Depreciation is still the driver of the cost of ownership. Ignoring cars wearing Bentley and Aston Martin badges, which can depreciate more in three years than the average UK wage earner brings home over five, let’s look at a performance SUV. The BMW X6 M (top of the page) will depreciate by £61,385 over three years if you buy it new. Buy a one-year old and you’ll ‘only’ take a £31,425 hit. The difference in total ownership costs over three years between buying new and used are £28,816 in favour of second hand.

Cutting to the chase: the cars that CAP Automotive claims will save you money by buying new are the Range Rover Sport and Evoque five door, Skoda Roomster, Porsche Cayman plus Audis A1 and S3. Those that will really cost you are prestige execs such as the Jaguar XJ, Audi A8 and VW Phaeton. No surprises there. More ordinary cars that barely cost you over three years if you’re running new rather than used include the Audi Q5 and A3, Nissan Juke, Skoda Fabia and Mazda CX-5.

Where these costs fall down is that they don’t take into account any discounts you might negotiate. And as dealers, egged on by manufacturer masters’ sometimes unrealistic demands, are desperate to shift new metal at the moment those can be significant. Forget conventional used over new wisdom. In some cases you’d be daft to buy a used car as the man says.

Peugeot HYbrid Air The car that runs on errr… air

BLOG Peugeot HYbrid Air (1600x1018)If I said one car maker had designed an engine that runs on air, you might imagine it would cost a king’s ransom. That’s when it goes on sale, which you might surmise wouldn’t be until about 2030. And anyway, doesn’t the whole notion of an engine fuelled by air seem a tad fanciful at best? Peugeot doesn’t think so. It has built one and it could be on sale within three years. But most importantly, if a HYbrid Air powered 208 was in dealers today it would be wearing a sticker saying £16,500 about the same as a diesel model.

Although called hybrid, rather than battery power accompanying petrol, the Peugeot system relies on compressed nitrogen. A tank of the gas, under very high pressure, pushes hydraulic fluid through a motor to generate power. It’s capable of around 30kW (40hp), but only for a very short time. That’s enough to get a car to 30mph, then after 300m the compressed nitrogen’s energy is exhausted. It doesn’t sound far but in the context of a big city centre that’s probably the distance between traffic lights.

The clever part is that the gas can be re-pressurised and therefore re-energised within 10 seconds of the internal combustion engine running. So a bit of idling at the lights and you’re ready to go again on air power. As with other hybrids, the car can run either on air alone, air in tandem with the petrol engine for what Peugeot calls ‘boost’, or petrol alone. In the boost phase, the engine would deliver the equivalent of 120hp. But a third of those horses would be free both in financial and environmental terms.

Although Peugeot has a prototype 208 model using this engine and claims 141mpg and 46g/km of carbon dioxide, that car uses lightweight materials and has aerodynamic tweaks designed to make it more windcheating. It would of course be correspondingly more expensive. But the exciting thing about this power source is that there are very tangible benefits to be had in an otherwise unmodified car: Peugeot reckons 94mpg and 69g/km which is well worth having.

Whether the HYbrid Air makes it beyond the prototype stage is down to whether Peugeot can find a partner and build sufficient engines to make it economically viable. I suggest, there is a sense and precedent that if something is right, build it and they will buy it, to bastardise the film tag line.

A version of this story was published in Daily Telegraph Cars

A clear view of the future

For years, replacing windscreens has been covered as part of comprehensive insurance policies. But we can no longer take it for granted.

Windscreen cover is currently a ‘free’ extra. It’s couched in this way so we think our kindly insurers are giving us something for nothing. Of course there’s no such thing as free in this world and we’re still paying for it. But ‘free’ things are easy to take away and that’s exactly what some cover providers, particularly on comparison websites, are doing.

Eliminating the cost of windscreen replacement enables a cheaper headline price. Knowing how many insurance policy buyers go for the cheapest possible cover these insurers take out screen cover and bingo! They can offer a lower price. The message is: ensure your windscreen is included in your cover or you could have an expensive surprise.

There again, the writing could be on the wall for ‘free’ windscreen cover any way. Anyone who thinks – as I did – that glass is glass, is in for some re-education. A new BLOG Windscreensreport by windscreen replacement giant Autoglass reveals that the simple windscreen will shortly be anything but. Car makers are working on adding systems such as eye trackers, augmented reality GPS and head-up displays to the windscreen. According to Dr Chris Davies, head of technical research and innovation at Autoglass, by 2020 there’ll be at least a couple of these systems on the road.

On the one hand, this is great. They’ll mean we don’t have to take our eyes off the road and thus make driving safer. They can also convey information about the driver to a third party meaning insurers can monitor people and reward or penalise them more accurately. On the other, it’s bad news. Dr Davies explained: “More exclusive, cutting edge products like this will generally see a higher price tag. Insurers will be required to take this into account as far as the pricing for premiums goes.”

So premiums could go up to take account of replacing this technology. Or windscreens may no longer be covered. I’m not saying this to scaremonger. Look back a few years and there’s a precedent. The advent of the panoramic windscreen introduced massive screens to everyday cars such as Vauxhalls and Citroens. Trouble was, they could cost the best part of £1000 to replace. The result was some insurers refused to cover them under the free windscreen section. Instead they were part of the main policy. And that meant a new windscreen stood as a claim and could have an impact on your no claims discount and therefore premium.

According to acquaintances in the trade, simply getting replacements was a challenge. The new breed of high tech windscreens is going to pose fitters such as Autoglass with similar problems. Dr Davies added: “More sophisticated technologies may require different fitting procedures and a higher level of expertise to perform additional actions such as the calibration of sensors. All of these factors can mean that the cost of replacement may be higher in future.”

So the ability for insurers to charge cheaper premiums because this technology will cut the number of accidents will be reduced by the expense of replacing the technology. However, Dr Davies said: “Glass technology will change. Companies are working on indestructible glass.” For drivers, that could be the final piece of the jigsaw, although I doubt companies like Autoglass are looking forward to that day quite as much.

The blonde in the corner

In another life I used to have to go to an annual car testing day somewhere on the European continent. This particular year it was in Italy. These test days were characterised by the large number of males, badly dressed as only German and BLOG Nico Rosberg_2Polish car journalists can be. Hardly surprising then that a sex-starved 20-something British writer should feel optimistic upon seeing a blonde sitting alone with their back to the crowd. “Who’s the blonde in the corner?” My lascivious colleague asked.

My friend, who was already working out how he was going to get this stunner up to his room, was even more interested when I said ‘she’ was called Nico. He was doubtless imagining I was going to be his ‘in’ to the exotically named foreign girl. Then Nico turned round, whereupon my friend suddenly lost interest.

At that time Nico Rosberg was 17 and had just won the German Formula BMW championship in his first year of car racing. I went over to talk to him about the cars we were testing and discovered that he’d only just qualified to drive and didn’t have any experience at all of testing road cars. However, like the majority of young racing drivers, he was mature way beyond his years. We had a sensible conversation about cars, racing and why he was competing under a German flag when his father was Finnish.

Just a couple of years later, he had a test with the Williams F1 team. I was discussing this with a friend who worked at Williams and wasn’t remotely surprised to find that the team had been impressed by Rosberg’s maturity and the quiet, focused way he got on with the job. It was a counterpoint to the other son of a famous father on the same test, Nelson Piquet Jr, who was considered a spoilt prima donna by the team.

Fast forward a decade and on the day Rosberg won the most famous prize of the lot – the Monaco GP – Piquet was failing in a World Rallycross round at Lydden Hill in Kent. Can’t say I was surprised. But whatever he achieves in his career, Rosberg will always be the blonde in the corner for me.

Drivers have never had it so good

There’s one very good reason to feel upbeat about motoring today: the amount of metal we get for our money.

In real terms, the cost of cars has stayed relatively static, yet what we’re buying has improved immeasurably. On price alone think of the Ford Fiesta. At its launch in 1976 the basic model cost £1856. In today’s money the Bank of England reckons that’s £11,313. Prices for today’s Fiesta start at £9995. Or there’s the Jaguar MkII. It was considered uniquely cheap at £1534 in 1959. That’s £30,225 today. Today’s equivalent, the XF, starts at £29,945.

Thirty years ago, SEAT launched its first car developed as an independent company. The Ibiza had a 1.5-litre engine that produced 85bhp. It cost from £3939. In today’s money that’s £10,721. It had a carburettor, wind-up windows, a radio and errr, that’s about it.

Carburettor, wind-up windows, radio and that's it. For only £690 more you can get today's far more sophisticated equivalent

Carburettor, wind-up windows, radio and that’s it. For only £690 more you can get today’s far more sophisticated equivalent

For £689 more, the current Ibiza has air-conditioning, electric front windows, remote central locking, an alarm, electronic stability control plus front airbags, power steering and an MP3 compatible sound system all as standard. It’s got a 1.2-litre 12-valve engine with 70bhp that’s good for 52.5mpg. The original was capable of just 36.2mpg.

Go back just two decades and Britain’s best-seller, the Ford Escort in basic Encore form had no electric windows, power steering was only available with the diesel, there was no central locking and no ABS, although a driver’s airbag was standard.

This lack of kit would be fine if it had been correspondingly cheap. But it wasn’t. The price for the cheapest three-door 1.3 Escort Encore was £9495 or £15,458 today. For £13,995, the equivalent Focus Studio has as standard ABS, alloy wheels, electric front windows, central locking, air-conditioning, steering wheel controls for the audio system, a Tyre Pressure Monitoring System, and like every other mainstream car, power steering.

Chairman and managing director of Ford in Britain Mark Ovenden explained why we’re getting so much more for our money: “Vehicles are engineered to global standards which dramatically reduces complexity and duplication, and delivers far greater economies of scale. We have also worked hard to drive out cost and eliminate waste in manufacturing and distribution.” The result is that in terms of the cars we drive, we’ve never had it so good.

What proposed diesel taxes will really mean

Until very recently, diesel was the fuel of choice for many motorists and for all the right reasons. Diesel cars tend to be more efficient and economical than petrol equivalents. They produce less carbon dioxide, a gas that until quite recently was apparently responsible for much of the world’s pollution woes. And while diesels usually cost more than petrol cars, they hold their value better, so you get more back come resale time.

Will taxing diesel really cut congestion and pollution?

Will taxing diesel really cut congestion and pollution?

Of course the oily fuel’s suitability remains dependent on the number and type of miles you do. And the increased pump price of diesel allied to improvements in petrol technology is encouraging many drivers to abandon it anyway. Now the hysteria has died down about the news that London’s mayor Boris Johnson wants a new £10 tax for diesel cars to enter new Ultra Low Emission Zones, with cities such as Bristol, Birmingham and Leicester following suit, it’s worth examining what the revelations really mean.

For a start, the penalty will come into place in 2020. But from the start of 2015, every diesel car will have to meet Euro 6 emissions legislation. This caps nitrogen oxide levels – the gas Boris and his regional friends are getting het up about – at 80mg/km, more than 50 per cent down compared to the Euro 5 that cars have had to conform to since 2011.

The result, according to Boris Johnson’s office, is that Euro 6 vehicles will be exempt from any penalty. Nick Reid, head of transformation at Green Flag added: “Euro 6 emissions regulations were drafted to address the concerns over particulates from diesel cars, and the criteria to meet them are tough. So drivers who wish to drive the cleanest diesel possible should ask the manufacturer’s sales staff to confirm whether their potential purchases is Euro 6 compliant.”

With the penalty unlikely to apply to cars that will be five years old and newer, used car price experts agree that residual values are unlikely to be affected. CAP’s Mark Norman told me: “It could have an impact on used prices if other cities follow London but while the capital is big it’s not big enough to hit residual values.” Richard Parkin from Glass’s added: “We don’t think it’ll have an impact. The congestion charge is substantial as it is so if you can afford to pay that on a regular basis, it’s unlikely another £10 will put you off a diesel.”

So the message is clear. If you’ve decided a diesel car ticks your boxes, go for a Euro 6 compliant model and rest easy that Boris’s emissions tax is highly unlikely to affect your investment. And whether the Government will change the car tax structure to penalise the output of nitrogen oxides is a question for another day.

This article first appeared in the Daily Telegraph Cars


Get every new post delivered to your Inbox.