How ditching your car for Uber could save you money

2016-12-05 13:07 - Kyle Venktess, Fin24
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Johannesburg - Drivers can expected to save an average of as much as R 14 000 annually by ditching their vehicles and opting to use the Uber service, according to online savings service MyTreasury.co.za. 

My Treasury - an independent savings optimiser that matches savers with the best bank account to maximise savings over time - took into account the depreciation of a car, insurance, parking, cleaning, licences, fines, tolls, petrol and of course the cost of taking an Uber to arrive at the total average amount. 

READ: Uber goes green in Cape Town

The catch is that the longer the commute, the higher the cost of an Uber.  Hence, My Treasury has said that ditching a car for Uber is better suited to those who have shorter commutes to work.  

 “If like many South Africans, you drive less than 50km a day, using an Uber will save you money,” Michael Kransdorff, chief economist and co-founder of MyTreasury.co.za said.

Drivers travelling 40 km per day or 14 575 km per year, would save as much as R14 000 per year by switching to Uber while drivers with a shorter travel distance can expect to save even more.

According to MyTreasury.co.za, calculations were based on a Toyota Corolla, one of the most common used by UberX drivers. A Toyota Corolla retails at R300 900 for the new model.  

READ: Uber targets 'disrupting itself', says Alon Lits

The car’s depreciation and financing costs are around R61 000 per year.

The average insurance was quoted at R1 500 per month or R18 000 per year for comprehensive insurance with a minimal excess.

Petrol costs depend on your driving patterns, but these costs worked out to be a standard of R27 000 a year for the average South African driver.

“Insurance, parking, cleaning and licenses are your fixed vehicle costs,” Kransdorff said. 

READ: Uber pilots dashcams, panic buttons in SA

The bane of a driver’s life is parking fees, which were estimated at R1 560 a year. Car washes are factored in at an average of R150, meaning it costs around R1 800 a year. Meanwhile, licences, tolls and fines typically amount to R2 000 per year, said My Treasury.

Kransdorff told Fin24 that the only downfall of ditch your car for Uber would be the instant access to a car. 

“One would need to order an Uber which takes a couple of minutes. It could also happen that during peak times a vehicle may not be available and that you may be required to wait,” he said.

“Also if you want to go on a long journey and then it’s useful to have a car but you could always rent for a short time,” Kransdorff told Fin24.

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