Generally, people assume that owning a car will prove less expensive than relying on taxi cabs for your regular commute. The difference will be significant if you use taxis sporadically but if you use them on a frequent basis, you might actually find travelling by tax cheaper than owning a car. This is usually because people sometimes ignore or overlook the different costs associated with owning a car. Here’s why taxi cabs are cheaper than they might appear:
The Cost of Gas (And the Size of the Engine)
Over the years, gas prices have been on an upward trajectory. As the world’s oil reserves are depleting, the price of gas will only continue to increase in the future. As a car owner, you have to bear the cost of gas but don’t have to even consider the cost of gas when travelling by taxi.
Over time, it will be more expensive for you to own a car. And speaking of owning a car, the average size of car engines is also increasing. The bigger the engine, the more gas the car will use per mile. Hence, your cost of commuting in your own car will be significant.
The Cost of Insurance
You may not realize this but basic car insurance can cost you up to R20,000 a year. There is a reason the cost of automobile insurance is called a ‘hidden killer’. For R20,000 a year, you can virtually take hundreds of cab rides.
Of course, you might find cheaper car insurance but then, there is a risk you might have to bear certain expenses out of pocket, which will reduce any cost savings you enjoy.
Repair and Maintenance
As a car owner, you are responsible for keeping your car in a good condition. You have to make sure the car is in perfect working order so you can take it out for a drive as and when required. This includes not just cleaning the car but checking the oil, topping up fluids, and taking your car to the mechanic from time to time.
Plus, you have to pay for repairs in case of any damage to the car or in case any of the components start malfunctioning. Of course, you don’t have to worry about all this when it comes to taxi cabs.
Depreciation
Depreciation is a cost many car owners tend to overlook. This is because you don’t have to pay for it out of your pocket and for the average person, it can be difficult to calculate. With regular usage and wear & tear over time, your car will lose value, which is referred to as depreciation.
In case you decide to sell your car, you will get a price much lower than what you paid for it. The longer you own the car, the more its value will depreciate over time. Again, you don’t have to even consider depreciation if you stick to riding in taxi cabs.
While owning a car does have its advantages, travelling by taxi cabs isn’t as expensive as people often make it out to be.