My Turn: The costs of transportation

By RICHARD WITTY

Published: 02-01-2023 3:36 PM

There are amazing transportation assets and services locally, most prominently the free Franklin Regional Transit Authority (FRTA) and its inexpensive driving services for seniors.

Still, the majority of transportation needs in Franklin County are met by private autos.

I’ve been an opponent of private autos as a norm since I was a teenager. They are dangerous projectiles. They pollute. They take up an enormous amount of space. They are expensive to own and to run. And, they are now minimum necessities. (Expensive and minimum necessity is a bad combination.)

We’ve designed every aspect of our community lives around cars. We live in single-family isolated homes predominantly — sprawl. We work far from where we live, and commute long distances daily, usually alone in our private cars. We drive to shop. We drive to see a doctor. We drive to friends’ homes.

Since Covid, the prices of new and of used cars has skyrocketed. That occurred for a couple reasons. First, the supply chain from China and East Asia was greatly disrupted during Covid. China became isolated. Shipping containers were backed up for months, affecting parts, sub-assemblies, final fabrication, and then shipping to dealers. Dealers’ inventories decreased significantly, and I assume that many lost a great deal of money in that time.

The inventory of SUVs and crossovers didn’t decrease as much as of smaller cars. The dealers found that they could make up for their losses in sales volume by increases in unit profits on the large vehicles. If they sold half as many SUVs as sub-compacts, but made three times as much profit on each SUV, then they managed. Auto manufacturers themselves had similar experience.

So now that the supply chain constraints have almost completely disappeared, manufacturers and dealers are keeping less inventory than previously as a deliberate strategy to keep prices high. That, and the absence of 2- to 3-year-old new cars available (due to lower manufacturing volume), keeps the prices high across the board.

For us consumers, the cost of transportation is very high. The majority of transportation costs are ownership costs (loans, insurance, taxes), the minority of costs are operation costs (gasoline, oil changes, tires, recurring repairs – brakes).

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The ownership costs of a new mid-range “compact” SUV — like a Toyota Rav 4 that retails for $29,500 + (always plus) less $10,000 trade-in include:

■Monthly car payment at 6% for four years, $458

■Monthly insurance, $150

■Monthly excise taxes, $40

■Total monthly ownership cost, $648

Operating costs include:

■Gasoline (1250 miles/mo., 28 mpg, 3.50/gal), $156

■Oil changes every quarter (monthly cost), $25

■New Tires every 60,000 miles (monthly cost), $20

■New brakes every 60,000 miles (monthly cost), $15

■Other costs (parking, tolls, etc.), $30

■Total monthly operating costs, $246

■Total monthly transportation costs, $896

That’s a lot of money every month. If there were a good, new, small car option at $18,000 retail ($8,000 after trade-in, the ownership costs would be around $380/month, operating costs of $175, and total costs of $555/month. (Still a lot.)

The thing about ownership costs is that they are fixed. If you own 0 cars, you struggle (especially in winter). The free FRTA routes are helpful, but still relatively infrequent and only serving those close to routes. If you own one car but your family needs 18,000 miles of service, you either do without for the ½-car needs, or you buy two cars and spend even more money (also at inflated prices).

To boot, in spite of the very often stated need for more energy efficient vehicles to reduce carbon emissions, the average mileage per gallon of private vehicles has been decreasing, and will further as small vehicles comprise a smaller and smaller percentage of cars sold.

So, we have a minimum necessity, increasing prices to consumers by design, increased emissions and very very limited alternatives.

There are answers, but it takes innovation and drive to make happen.

Richard Witty lives in Greenfield.

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