I'm currently using a 2012 model i20 Asta Diesel which I bought from showroom. It is almost 2.5 years now and the vehicle has run 46, 000 KMS. My running is a bit high as I keep travelling to my home town every weekend. By the Grace of God the vehicle is in perfect condition and there is no need for me to sell it. But since my kids are growing up, we are feeling the need of a car with boot, basically a sedan so the cabin is not filled with baggages.
So the first thing that came to my mind is, which type of car to buy, a petrol or diesel? Since I'm already using a diesel car, is it really worth going for another diesel car or should I go for a petrol car? I thought of looking in to the details.
My vehicle has done 46, 000 KMS in 2.5 years. Which means, my average yearly running is approx 18, 400 KMS(1, 533 KMS / month). In the next two months, my running will increase due to some personal commitments and my average monthly running will become 2, 100 KMS approx. With this information, I did a small study on which type of car to buy, a petrol or diesel.
For the sake of this study, I took the details of the top-end variant of the new Honda City.
1) On-road Price: 11.67 lakhs
2) Initial Amount: 3 lakhs
3) Amount Financed: 8.67 lakhs
4) EMI per lakh for 5 years: Rs.2, 100
5) Monthly EMI: 18, 207
Monthly Fuel Cost
6) Avg. Monthly Running: 2, 100 KMS
7) Vehicle Mileage: 13 KM/Ltr
8) Fuel needed per month: 161.53 Ltr
9) Cost per litre: Rs.77(Currently it is Rs.75/ltr. I just added Rs.3 more)
10) Monthly Fuel Cost: Rs.12, 438
Insurance Premium
11) Yearly Premium: Rs.30, 000
12) Convert to monthly: Rs.2, 500
Periodical Service Cost(Every 10, 000 KMS)
Converting this cost to monthly would be as follows
13) Cost per service: Rs.3, 000
14) # of services a year: 2
15) Cost of service per month: Rs.500
Tyre Wear & Tear
16) Tyre replacement every: 55, 000 KMS
17) Distance will be covered in: 27 Months
18) Cost per tyre: Rs.5, 400
19) Cost for 5 tyres: Rs.27, 000
20) Cost per month for 5 tyres: Rs.1, 350
Total monthly expense for Honda City Petrol: Rs.34, 995
HONDA CITY DIESEL
Loam EMI
1) On-road Price: 13 lakhs
2) Initial Amount: 3 lakhs
3) Amount Financed: 10 lakhs
4) EMI per lakh for 5 years: Rs.2, 100
5) Monthly EMI: 21, 000
Monthly Fuel Cost
6) Avg. Monthly Running: 2, 100 KMS
7) Vehicle Mileage: 13 KM/Ltr
8) Fuel needed per month: 131.25 Ltr
9) Cost per litre: Rs.60(Currently it is Rs.57/ltr. I just added Rs.3 more)
10) Monthly Fuel Cost: Rs.7, 875
Insurance Premium
11) Yearly Premium: Rs.34, 000
12) Convert to monthly: Rs.2, 833
5, 000 KM Service
Because my average monthly running is high, I usually replace engine oil and oil filter every 5, 000 KMS apart from the periodical service(every 10, 000 KMS). This may not be needed but I do it for my satisfaction to keep the engine running good. This intermediate service is not required for a petrol car. So converting the 5, 000 KM service to monthly cost would be as follows.
13) Cost per service: Rs.2, 500
14) # of services a year: 5
15) Cost of service per month: Rs.1, 042
Periodical Service Cost(Every 10, 000 KMS)
Converting this cost to monthly would be as follows
16) Cost per service: Rs.5, 000
17) # of services a year: 2
18) Cost of service per month: Rs.833
Tyre Wear & Tear
19) Tyre replacement every: 55, 000 KMS
20) Distance will be covered in: 27 Months
21) Cost per tyre: Rs.5, 400
22) Cost for 5 tyres: Rs.27, 000
23) Cost per month for 5 tyres: Rs.1, 350
Total monthly expense for Honda City Petrol: Rs.34, 933
Cost difference between Petrol and Diesel Honda City top-end variant is Rs.62. Meaning, Petrol car is costlier by just Rs.62 per month.
What does this mean?
If your average running is 2, 100 KMS or lesser a month, I would suggest you to go only for petrol car because the difference between both petrol and diesel Honda city is only Rs.62 per month. This is a negligible amount compared to the maintenance cost that you could spend on a diesel car.
Meaning, petrol cars always costs less in maintenance than diesel cars.
Even if the petrol car is costlier by Rs.1, 000 a month, I would still suggest to go for petrol itself because closer to that amount you would spend on the maintenance of a diesel car in the long run.
Not only that, even though diesel engines have reasonably good durability, as the vehicle covers more KMS, maintenance can also be expensive at certain intervals. Whereas a petrol engine can run between 2 lakh to 3 lakh KMS easily. So durability wise also, petrol engines will be better than diesel engines.
As per the above details, if you buy a diesel car, you need to run minimum 2, 500 KM - 3, 000 KM a month to save a good amount each year.
In the second hand market, these days a diesel car will get more resale value than a petrol car for sure. It depends on the make, year, condition, etc. But for both petrol and diesel, it has its base value in the second hand market. So if its Honda, Toyota or Maruti, I believe you will not lose much because they have reasonably good resale value.
The next thing is about the feel you get when you put diesel or petrol. When you fill diesel in your car, you won't feel the pinch. But when you fill petrol, you really feel the pinch.
But in reality, even though you pay less when you fill diesel, the amount you save compared to filling petrol will be spent on maintenance of the diesel car. Hardly people realize this.
But once you are convinced with this calculation, you won't feel the pinch when you fill petrol because in the long run you would be saving money on maintenance compared to a diesel car.
Hope this helps someone?
