If you’re set to receive a sizeable tax return and you’re in the market for a new car, have you considered going green? The benefits could be more than the fuel economy.
As more emphasis is placed on going green, there are a lot of questions surrounding what the regular Joe or Joanne can do to minimise their carbon footprint. One of the key areas they can look at is their car.
Fuel savings with green cars
We’ve used the Australian average driving distance of 13,400km per year - according to the Australian Bureau of Statistics (ABS) - and a fuel price of $1.30/litre for diesel and 91, and $1.50/litre for premium to determine potential savings.
See below for fuel savings calculations using some fuel efficient vehicles - regular fuel vs hybrids - as examples. Being that the average age of cars on the road is 10.1 years - also according to the ABS - the savings could be worthwhile.
The base model has a price guide $71,900, while the hybrid starts at $78,900, for a difference of $7,000.
The base model consumes 6.4L/100km and demands premium fuel, or $1,286 per year. The hybrid consumes just 2.2L/100km, or $442 per year.
This is a price difference of $844, meaning you’d need to own the car for just over eight years to recoup the extra outlay on the hybrid.
The cheapest E300 has a price guide of $114,300, while the cheapest hybrid is $119,600, for a price difference of $5,300.
The regular base model consumes 7.2L/100km and commands premium fuel, costing $1,447 per year. The hybrid consumes just 2.2L/100km, or $442.
This is a price difference of $1,005, meaning it could take as little as around five years to recoup the cost of the hybrid vehicle.
For a Camry, about the cheapest you’ll find has a price guide of $28,290. This is the Ascent Auto. The good news, however, is that the cheapest hybrid is just $30,590 - a difference of $2,300.
The regular base model consumes regular 91 petrol at a rate of 7.8L/100km combined, or $1,359 per year, while the hybrid consumes just 4.2L, or $732.
This could result in a fuel saving of $627, meaning you’d need to own the car for just over three and a half years to see the benefits of fuel savings.
What are the benefits of driving a green vehicle?
Owning a green car has potential benefits beyond just the savings at the petrol bowser, as seen above. Benefits are:
Fewer carbon emissions: The carbon emitted from cars contributes to greenhouse gases which then contribute to global warming. Looking at the Camry above, the combined carbon emissions amounts to 181g/km, versus the hybrid model which emits 96g/km - just over half. Carbon emissions have been linked to increased instances of cardiovascular disease and respiratory issues, and even violent behaviour.
Fewer trips to the petrol station: The fuel light always seems to come on at the right time, doesn’t it? With electric vehicles you can avoid the petrol station altogether, and charge your vehicle overnight at home or at some shopping centres while you shop. With hybrids you can go farther between filling up, which could reduce the temptation to buy overpriced servo snacks! Less filling up also means you might not be as subject to the volatile fuel price cycles as seen in Brisbane, Sydney and Melbourne.
Potential tax and rego benefits: Depending on what state you live in, you may be eligible for discounts on registration and stamp duty if you drive an electric vehicle. At the federal level, the luxury car tax doesn’t kick in for electric vehicles until $77,565, as opposed to the regular $67,740.
Less engine noise: While this is probably less of a consideration given how quiet modern cars can be, with an electric vehicle in particular, there is no engine to make noise. This means that when sitting on the highway, the engine isn’t droning at 3,000rpm, which can result in less driver fatigue. All you’ll hear is the wind brush past as you slink away into the night.
Green car loans
Another potential way green thumbs are rewarded by purchasing a fuel efficient vehicle is through a lower car loan interest rate.
For example, loans.com.au offers a 70 basis point discount if your car is on the approved fuel efficient vehicles list. By default, all electric and hybrid vehicles are on the list, so the variety of vehicles to choose from is quite wide.
When comparing the two for a $30,000 loan paid over five years with no deposit and no balloon payment, the monthly payment on the new car loan is $562, as opposed to $552 for the green car loan, a potential saving over five years of $600.
If you’re ready to get your green car loan pre-approved, book an appointment with one of our friendly car lending specialists today.
Book an appointment