Calculate the real cost of a Vehicle

How to find the real cost of owning a Car or Bike

What is the real cost equation for calculating the real cost of a Car or Bike? It includes several steps starting with On-road Price.

Step 1 – On road price of the car. Add the following steps to this.

Step 2 – Interest on the loan over the repayment period.

Step 3 – Fuel cost over the ownership time.

Step 4 – Maintenance cost and the service cost over the ownership period.

Step 5 – Insurance cost of the ownership period.

Step 6 – Cost of the consumables like tyres and all for the ownership period.

Step 7 – Reduce the approximate resale value at the end of the ownership period.

The interesting thing is that the potential buyers generally try to look at the On road price of the car and then only secondarly as the fuel cost. Most of the buyers does not get into the other factors before take a decision for buying the car or bike. But it can also account for as much as a third to a half of the cost for owing a car.