Wednesday, December 28, 2011

Owned vs rented car

People generally assume that car rental is very expensive and owning a car is cheaper. Here is a sample analysis for the same,

Assuming Car Value = 5 lacs

Expense Per month
Interest = 4000
Depreciation = 6000 (for first yr)
Insurance = 1000
Maintenance =1000
Driver = 8000

Lets assume 1000 km a month and average of 15
Petrol = 4500

Total expense for 1000 Km for a month = 24500. i.e. 24.5 Rs/Km

Most radio cabs charge from 15-20 Rs per KM. So it isn't really a bad deal.

However your own car offers a huge convenience of using it anytime at a moments notice and personalization. 

1 comment:

Prashant Bhardwaj said...

1. I am glad that you are writing more often...

2. I am glad to see these stats!!! I had done a very similar calculation for going to office (from NOIDA to Gurgaon) and realized that radio cabs are not too bad an option if you are carpooling, infact they might just turn out to be more convenient one!