Why are people counting depreciation as a cost?

Because on average over the life of a car, it is more per year than servicing! It’s also the biggest reason why a used car is often better value.

It doens’t affect your monthly budget though unless you are leasing.

So depreciation is being used as a proxy for purchase price or repayments?

That makes sense but seems a bit hypothetical.

So, is the lesson in this that the best way to reduce costs is to get your employer to give you a nice allowance to pay for it?

Because on average over the life of a car, it is more per year than servicing! It’s also the biggest reason why a used car often costs less is often better value.

FTFY

Value is subjective and not always linked to a financial amount.

That makes sense but seems a bit hypothetical.

If I buy a car for £20k, drive it for a few years then sell it for £10k, then it’s cost me £10k in real actual money for the ownership of the car during that period. No?

Really, I guess it’s a toss-up between how much you’re willing to pay against what you’re prepared to accept. The former is what you buy, the latter when you get rid. A five grand car is a five grand car whether you’ve owned it from new for several years or paid five grand for it last week.

So, is the lesson in this that the best way to reduce costs is to get your employer to give you a nice allowance to pay for it?

Which in itself is a fallacy unless there’s stipulations that the money has t be spent on a car.

e.g. I reckoned my car had paid for itself 3x over in profit on 45p/miles. But that would be 30x if I’d bought a £500 car (and somehow it hadn’t broken down).

If you’re paid a flat rate of car allowance then anything you can do to make it cheaper is pure profit.

make sure you keep the tyre pressures correct to get the best mpg from your car.

Which in itself is a fallacy unless there’s stipulations that the money has t be spent on a car.

We have restrictions, in theory. No sports cars, no less than 3 (IIRC) years old and so forth. In practice it’s never been enforced in the history of ever outside of those still on the company car list rather than receiving an allowance.

e.g. I reckoned my car had paid for itself 3x over in profit on 45p/miles.

I’d have to check, but I’m fairly sure that only applies to people running their own cars, as opposed to an allowance. Allowance / company car remuneration is much less I think, though I do so little business driving these days that I don’t actually know.

I bought a one year old Nissan Leaf Tekna 24 Kw battery about four years ago.

£0 VED
Once out of warranty, the servicing is peanuts, air cabin filter about £25, 10 minutes of my time to change and fit.

7,000 miles per year, virtually all home charged,
4 miles per kWh , even if we bought all the electricity from the grid (which we don’t) , £280 based on £0.16p kWh

MOT £40

Tyres last about 20,000 miles
Brakes last about 80,000 miles due to regen braking

True energy cost for us, having solar panels and a Tesla Powerwall 2 battery is somewhere in the region of £0.05p

£80 ish

Seriously cheap motoring if you can live with the range.

I didn’t have a clue so just spent £15 minutes doing a quick tally up.

Car:
Loan £0 (Paid off, had it years, big mileage)
Fuel for 21,000 miles £2550
Insurance £250
Breakdown Insurance £70
Garage costs £40 (just the MOT)
Tyres £200 (averaged over life expectancy)
DIY costs:
Brakes £80
Major service inc gearbox/coolant £115
Suspension bits (proactive maintenance) £180
£3485 or 16.5ppm

Camper:
Loan £0 (had it a few years, bought with savings)
Fuel for 4,500 miles £980 (MPG dented by lots of towing)
Insurance £335
Breakdown Insurance £70
Garage costs £35 (just the MOT)
Tyres £100 (averaged over life expectancy)
DIY costs:
Rear discs, pads and one seized caliper £500 (result of overheating)
Major service inc gearbox, diff, coolant £160
£2180 or 48.4ppm

Combined £5665 or 22.2ppm. Admittedly, I have probably spent loads on tools and lost days spannering instead of cycling…

PS Depreciation, the car is negligable as its 10 years old and the mileage means it would only really be bought as a bangernomics car by the next owner. The camper, must be depreciating a bit but not considerable, cos its a camper.

PPS Forgot the road tax. Car must be £200ish, van £230ish.