|
|
Home > Research and Analysis > Petroleum Product Market Outlook - April 2006 > The Cost of Operating a Vehicle
Petroleum Product Market Outlook - April 2006
The Cost of Operating a Vehicle
Table 1 shows, for a variety of car types, the increased fuel cost for consumers over the course of a year. Estimates of fuel consumption and fuel cost are based on a driving distance of 20,000 km annually, with a mix of 55% city and 45% highway driving. The base case, using gasoline prices of 92 ¢/L (the 2005 Canadian annual average) shows the annual fuel cost for a variety of vehicles. The remaining columns indicate the increased fuel costs for a number of price scenarios.
Table 1. The Impact of rising Gasoline Prices on Annual Fuel Costs
| |
Avg. Fuel Economy* litres/100 km |
2005 |
Increased Average Annual fuel Costs from 2005 |
$0.92 |
$1.00 |
$1.10 |
$1.20 |
$1.30 |
Subcompact |
Toyota Echo |
6.4 |
$1178 |
$102 |
$230 |
$358 |
$486 |
Compact |
Honda Civic |
7.0 |
$1288 |
$112 |
$252 |
$392 |
$532 |
Mid-size |
Chevy Malibu |
8.8 |
$1619 |
$141 |
$317 |
$493 |
$669 |
Full-size |
Ford Five-Hundred AWD |
10.6 |
$1950 |
$170 |
$382 |
$594 |
$806 |
Van |
Dodge Caravan |
10.4 |
$1914 |
$166 |
$374 |
$582 |
$790 |
Pickup Truck |
Chevy C1500 Silverado |
13.0 |
$2392 |
$208 |
$468 |
$728 |
$988 |
SUV |
Dodge Durango 4X4 |
15.4 |
$2834 |
$246 |
$554 |
$862 |
$1170 |
*Source: NRCan’s Energuide Fuel Consumption Guide 2005
Rising gasoline prices increase annual fuel costs substantially, even for drivers of fuel‑efficient vehicles. As illustrated by the table, an increase in annual average prices to $1.30/L could add as much as $1100 to annual fuel costs for a vehicle. If April 2006 prices were to prevail for the rest of the year, annual vehicle operating expenses could increase by between $230 and $550, depending on the type of vehicle driven.
Despite higher energy prices, Canadians have not significantly reduced their energy consumption. As previously noted, Canadian gasoline consumption decreased by only 0.4% in 2005, despite the 14% increase in prices. Meanwhile, overall vehicle sales rose for the first time in three years. While Americans did reverse their 25 year-long trends to buying more trucks (which include vans and sport utility vehicles) than cars, Canadians for the moment, seems reluctant to change their buying patterns: trucks accounted for 48.2% of vehicle sales last year, up from 47.9% the year before.
|
