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Can you afford to run a car in Vietnam?
As cars become more popular in Vietnam increasingly families are swapping two wheels for four, yet many are surprised at just how expensive it can be.
More and more cars are rolling on to the streets as Vietnamese incomes and buying power increase.
However, a quick survey conducted by VnMedia shows that when buying cars, seven out of every 10 car owners in Hanoi did not know exactly how much they would have to pay each month to ‘feed’ them.
Nguyen Anh Tuan, who has had a Toyota Innova G for one year, said that his whole monthly income of 10 million dong has been spent running the car. This has forced his family of four to make savings elsewhere so they can live off his wife’s income.
This is a classic and increasingly normal situation for the Vietnamese car owner. Many, who did not anticipate the huge running costs have been forced to sell the cars just to ease the financial burden.
According to Bui Quang Hung from the Personal Banking Division of Techcombank, in the first three years, a car buyer doing 20,000 kilometres would have to spend 90 million dong ($5000) on petrol.
Also in the first three years, they are likely to have to pay a further 90 million dong in repyaments, 3.6 million dong ($200) on oil changes and 4.8 million dong ($270) on car maintenance.
Besides compulsory expenses, the car owner will have to pay miscellaneous expenses estimated at 15 million dong ($830) for three years. They will also have splash out on an insurance policy, estimated at 30 million dong ($1660) for three years.
In general, the total sum of money paid out an Innova G would be 233.4 million dong ($13000) for three years , or nearly 6.5 million dong ($360) a month. This does not include tolls, garaging and cleaning fees which could easily eat up another one million dong ($55) a month.
The advice in Vietnam, according to Hung, is that transport expenses should not be higher than a half of the total income of a family. This means that in order to run a car there must be a minimum family monthly income of 15 million dong ($830).
Meanwhile, the spending would be a little smaller for the users of cheaper models such as Kia Morning, Daewoo Gentra, Spark or Hyundai Getz costing between 300-350 million dong ($20,588). In general, it costs some 4.3 million dong a month to run a small size car like these, which means the car owners need to have a monthly income of 10 million dong ($550).
The message for potential car owners in Vietnam is think before you buy – the initial cost is just the start.
vietnamnet, vnmedia
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