As the credit crunch sends the cost of motoring on the UK’s roads soaring, hard-pressed Brits are being left counting the pennies. An estimated 10% rise in motoring costs from last year is seeing a large number of drivers exasperated.

While the government has recently been increasing eco-pressure on drivers to leave the car behind and take the bus or train, public transport isn't always a practical option – it can be unreliable, dirty and, for those who travel frequently, as expensive as taking the car.

At a time when both the standing and running costs of the average car is around £100 per week, fuel remains one of our biggest vehicle-related expenses, second only to the overall depreciation of the cars we drive. Finance payments are third on the list, whilst car insurance comes fourth, not to mention tax, service etc…. It all adds up to almost £5,540 per year spent running our cars .

Leading online insurance broker www.motorinsurance.co.uk provides UK motorists with some handy hints on keeping vehicle costs down.

Petrol

Over the last five years, UK motorists have seen the price of petrol increase by 71% as the cost per litre has risen from an average of 69.9p in 2002 to the current average of £1.08. The price of diesel is also following a similar pattern, now pushing past £1.18 per litre in many areas across the UK.

Whilst motorists can’t do anything to physically reduce the price in fuel, there are a number of practical pointers for reducing fuel consumption.

- keep your car well maintained
- avoid sudden sharp increases or decreases in speed
- drive as smoothly as possible, and avoid top speeds
- drive an empty vehicle where possible as more weight = more fuel
- keep tyres properly inflated

You can also save on the litre price by finding the cheapest petrol station you can, rather than using the most convenient. Look out for all the petrol stations on your way to and from work and compare prices.

Obviously the best way to save petrol is to not use it! Sounds difficult if you need your car to get around but you could consider sharing the driving. Enquire at your place of work if there are others who live near you, or if you use the car every day for the school run there may be other families that live close who’d be happy to share collecting the kids.

If you’re buying a new car it might be prudent to consider a hybrid or electric car. If you live in the city an electric car may be ideal as top speeds are low. For longer journeys or motorway drives, a hybrid could suit. Whilst these can be expensive to buy initially, they may save money in the long run.

The cheapest Hybrid cars currently on the market are the Toyota Prius Hybrid and the Honda Civic Hybrid.

Depreciation

Whilst all motorists eventually feel the cost of vehicle depreciation, when we drive a brand new car off the forecourt, it loses value instantly. A car from a dealer which has been pre-registered, is ex-showroom, or nearly new, will cost less and is usually still offered with all the warranty perks and assurances of a brand new vehicle.

It’s well known that some makes lose value quicker than others, so make sure you do your research before buying. It may seem like you’re getting a bargain now, but when you come to sell, what return will you get? Consider the following when buying a car:
 the cost new
 the cost now
 the cost when you plan to sell
There are many handy online depreciation calculators to help you decide.

The best car to buy is one that’s best in its range, rare, or highly sought after. Despite depreciation worsening, smaller cars are in high demand due to their lower running costs, and are still holding their value.

Road Tax

New Car tax brackets came into effect from 13th March, 2008. Whilst some of us will remain at the old rates if we have an older car, those buying new cars should be aware of the implications.

Car Tax Brackets Chart – 2008 to 2009
Registered before 1st March 2001
Engine Size 6 month 12 month
Up to 1549cc £ 120.00 £ 66.00
1550cc and over £ 185.00 £ 101.75

Registered on or after 1st March 2001
Band Emissions g/km 6 month 12 month
Band A Up to 100 £ 0 £ 0
Band B 101-200 £ 35.00 £ Not available
Band C 121-150 £ 120.00 £ 66.00
Band D 151-165 £ 145.00 £ 79.75
Band E 166-185 £ 170.00 £ 93.50
Band F Over 185 £ 210.00 £ 115.50
Band G
(cars registered on or after 23.3.06) Over 225 £ 400.00 £ 220.00

So, which new cars fall into which brackets under the current regime?
Band A VW Bluemotion 1.4Tdi Diesel / SEAT Ibiza Ecomotive
Band B Skoda Fabia Estate Greenline Diesel / Peugeot 107 1.0 / Citroen C1 1.0i / Mazda 2 1.4 Diesel / Smart FourTwo Coupe / Vauxhall Corsa 1.0i ECO 12V 3 door hatch
Band C Renault Megane Hatchback 1.5 dCi 106 Diesel / Ford Focus 1.6 TDCi / Renault Clio 1.2 Quickshift Petrol / BMW 3 Series 320d coupe / Toyota Yaris 1.3 WT
Band D Audi A3 2.0 Tdi / BMW 3 Series 320i / Vauxhall Astra 1.4i 16V
Band E Citroen C5 2.2 Hdi Estate / Ford Mondeo 1.6 Petrol Estate
Band F and over Peugeot 407 2.0 Petrol Saloon / Peugeot 807 2.0 Petrol / BMW X5 Series E70 / Land Rover Sport Auto 3.6 TDVB

Remember, tax brackets change again for the year 2009-2010 and again for 2010-2011 so it may be worth looking a few years ahead if you’re buying now. The emissions brackets in 2009 will be split down even further, so the lower your emissions, the better. Tables for 2009 and 2010 can be found on the Direct Gov website. The Parkers website has a handy road tax calculator, for both old or new cars, displaying the Band and the price you’ll pay for the year beginning March 2008, 2009 and 2010.

If you’re buying a second hand car, it may be best to consider one registered before 1st March, 2001 before the road tax changes came into effect, depending on the emissions.

Finance

Few of us can afford to buy a new car outright. Whilst today's financing options can make it easier than ever to drive away a new car, the interest rates attached to car loans can mean that you end up paying far more than your vehicle is worth.
- put down the biggest deposit you can afford, as this will guarantee better interest rates on your loan
- work out what you can afford each month, allowing a little extra in case your circumstances change
- Compare quotes like for like, looking at the term, amount and APR
- If you’re going to spend a large sum of money on a new car, make sure you insure it fully comprehenisve, so you are able to pay the loan back should anything happen to it!

www.motorinsurance.co.uk offer price comparison on a range of finance products, so if you’re thinking of financing a new vehicle, look no further.

Congestion Charging

With congestion charging now at £8 per day, this equates to around £ 2000 a year for daily commuters. That’s not to mention tolls – the QE2 bridge (Dartford River Crossing) is still charged at
£1 each way for cars during peak times, and was oriignally put in place to pay back the costs of building of the bridge, over 15 years ago!

The most obvious way of avoiding the Congestion Charge is to avoid the area – take alternate routes. It may be that your journey only takes you briefly into these areas. If you have a sat nav system try searching for a route ‘avoiding’ certain roads. A map of the zone can be found on the Transport For London website.

Avoiding the zone just isn’t possible or practical for everyone. If you venture into London very regularly you may want to consider paying the Congestion Charge weekly, monthly or yearly – a monthly pass gives you 3 free days and a yearly pass 40 free days. Remember, if you are paying daily, pay on the day you travel – you can pay the next day but the charge increases by £ 2 for the privilege!

An alternative is to park outside the Congestion Charging Zone in a secure car park. Westminster City Council has 2 car parks outside the zone, close to tube stations . One is in the Park Lane / Marble Arch area and offers a FREE park and ride service into the city*, the other is located in St. Johns Wood.

If you’re looking at changing your car, most hybrid cars save 100% on the London Congestion Charging (subject to an annual registration fee of £10.00), and from October 2008 any car with emissions below 120g/km will also be eligible for this discount .

Servicing / MOT

Many garages are now offering low cost MOT’s in order to attract our custom in today’s competitive market. The recommended maximum cost for an MOT is now £ 50.35 .

So, should we be worried about garages that boast rock bottom prices? Beware of cheaper garages that load repair costs in order to entice customers with low initial costs.

One way of ensuring you get a fair deal is to use a local council or government MOT test Centre. These centres are legally obliged to be open to the public, and because they don’t carry out repair work, there’s no financial incentive for them to fail your car. Therefore they will only fail you if it’s genuinely warranted. So, whilst you may miss out on a cheap MOT deal at a garage, you should only pay for the repairs you genuinely need.

The Council tests are usually very good and carried out to a high standard. If you have gone to a garage and feel you’ve been treated unsatisfactorily, you can make an appeal. Details are found on www.directgov.co.uk. Your local council website may also have a list of vetted garages.

Watch out for similar pitfalls when it comes to servicing. Obviously, if you get your car serviced by a manufacturer main dealership, it is likely to cost more as they use original parts, but in theory these should last longer. If you do pay more for regular main dealer servicing, you’ll be more likely to get a higher asking price for your car when you come to sell it.

Insurance

The cost of car insurance is the fourth-biggest cost of motor ownership, and it is important to shop for the best deal.

Paul Cosh, Managing Director for motorinsurance.co.uk, comments: “The current credit crunch has people tightening their belts. As our guide shows, there are some easy and practical things that drivers can do to economise. By using a comparison site like www.motorinsurance.co.uk, you can easily cut out the legwork involved in getting a car insurance quote.

-ENDS-
Notes to editors

Permission is not required to create direct links to www.motorinsurance.co.uk

www.motorinsurance.co.uk, operated by Hero Insurance Services Limited, uses a panel of more than 30 well-known insurers, including AXA, Fortis, Highway, Norwich Union and Zurich, so it can offer its customers some of the UK’s best value motor insurance policies.

It’s quick and easy to complete application form has been specially designed to provide insurers with the details they need to give the best quotes possible.

So, www.motorinsurance.co.uk customers do not have to spend hours in front of their computers filling out form after form, yet still get a great deal on their motor insurance.

For further information please contact:

Contact:
Laura Downing
Hero Insurance Services Limited

laura.downing@highway-insurance.co.uk
01277 266033