The Price Ain't Right

Bycycle Magazine, 6. 1999.

What does it cost to use a bike as opposed to a car? Transport economist Anna Semlyen does the sums.

Forget, for now, about the social costs of motoring. Forget about pollution, health, happiness and all that because most people don't care. Ask them to consider using their car less, or even doing without it and they will think partly about convenience and partly about cost. One brutal fact quickly looms up: over 55% of a car's costs are fixed, making the running costs relatively low. This is a big factor for car owners thinking of buying a bike or bus ticket: why spend more when there's a capital asset parked outside doing nothing? Very few people fully understand their motoring costs and so massively underestimate them. Once the huge fixed elements are paid (25p a mile), marginal costs are small: around 10p for petrol and oil plus 5p for services and spares per mile and usage based depreciation of 5p per mile. Consequently cars are driven far more than is necessary or desirable.

You may have seen the recent Dispatches programme on the television. By way of an experiment a busy two-car family gave up their cars for a week, in exchange for the £108.83 they would have spent on running both cars (the method of calculation was not made clear). They used taxis and buses and one of their sons began cycling to school, or at least as far as his grandmother's, who drove him the rest of the way, along a busier stretch of road. Well, they all had a fraught and miserable time coping with a lifestyle structured around car use: waiting for taxis and shivering at bus-stops. Clearly, if you want to cut down on car use you don't need to go in for the all-or-nothing dramatics required by television. it can be done gradually, and involve some well-planned restructuring of your life. The programme, on the whole, did the car-free movement a disservice, but the figures from other sources for making the change offer some interesting reading.

The following figures are based on two different vehicles: my used Astra (which I've sold) and a new mid-range car, driven 10,000 miles a year. Total yearly costs were around £2,500 and £4,200 respectively. Fixed costs of age-based depreciation, interest lost on sunk capital, insurance, tax, motoring organisation, MOT and parking permit amount to £1,300 and £2,700. Variable costs of fuel, servicing, spare parts, repairs, mileage-based depreciation, oil, parking meters, tolls and car wash are £1,200 and £1,500 annually.

If paying 23% tax and 10% National Insurance, the income needed to run each vehicle is £3,800 per year (for the used Astra) and £6,200 for the new car. That's £72 to £119 weekly! By choosing not to own a car you release all its fixed costs. As the graph shows, an intelligent use of alternatives can save money, even when taking the fixed costs of a car into account.

Remember, if you hire a car occasionally there are no fixed costs. For less than the costs of owning a used car you could hire a small, brand new car for eight full weeks or 26 weekends every year.

Consider what your household's ideal blend of alternatives would be with one car fewer. Walking more and using a mix of cycle, taxi, hire car, rail and bus you might spend £1,7000 on travelling 6,130 miles a year - 4,000 miles further than you could get spending the same money running a used car (see the Mixing the Modes table) Being car-free is cheaper if you do less than around 8,000 miles a year.

Cost out your time relative to your hourly wage. For instance, you could use the time on a train journey to relax or work. Walk or cycle more and you won't need to spend time and money going to a gym. Subtract the value of time from your car-based figures and see how your lifestyle choices look then.

But what are the costs of cycling?

For my calculations, I have considered an adult switching from driving to cycle commuting and undertaking some light work by bike totalling five miles a day. Five miles daily for 240 working days comes to 1,200 miles per year.

Figures in the cycling costs table are from the Cyclists' Touring Club's: What Price Cycling? June 1993, adjusted for subsequent inflation and include interest lost on capital and income needed before tax. Of course, you could spend less or considerably more.

Since April 1999 tax on employee benefits excludes bicycles and cycle safety equipment and also workplace cycle parking. Staff who use their own bike for business travel qualify for capital allowances. In my example, capital allowances might be £70 minus personal use, say £40 (commuter journeys are not allowable). So tax relief is worth £13.20. I suspect few will actually claim it.

Bikes are good value. I calculate that if you pay £500 for a bike and accessories, and ride it for six years, it will cost £213 per year in depreciation, third party insurance, personal injury insurance, servicing, spares, safety wear, clothing and lighting. The relevant comparison is a good bike, ideally a folding bike, with regular shop servicing. That's £4 a week: you're not likely to go as far, but bikes can cost less than a twelfth as much as a car.

The tax-free cycle mileage allowance has increased to 20p a mile. You may be lucky enough to work for enterprises which offer high cycle allowances: such as Southampton University Hospital at 50p a mile and the Borough of Kensington and Chelsea at 44p a mile.

So, , it seems it is a myth that cycling costs virtually nothing as I read in the current North Yorkshire Draft Cycling Strategy (Jan 1999), particularly if you need to buy a new bike and accessories. But cycling is very good value at less than half the costs of a bus pass.

Variable cycling costs are 8.6p per mile. So if you already own both a car and a bike, you save 11.4p per mile by cycling instead of driving.

For a free car costs sheet and tips on reducing car use, send a SAE to Anna Semlyen, 24 Grange St, York YO10 4BH. The idea is supported by the Energy Efficiency Best Practice Programme. www.cuttingyourcaruse.co.uk

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