Is Buying A Car In The Philippines Worth The Expense?

Is Buying A Car In The Philippines Worth The Expense?

Is owning a car in the Philippines worth the expense? Or would you be better off booking a Grab ride to get to work? Let's find out!

Back in the day, owning a car in the Philippines was seen as a sign of wealth. However, with more and more affordable options available these days, it’s much easier for a regular employee to save up and buy a car.

After all, it’s much more convenient to be able to drive around, instead of commuting. Add to that the fact that most public transportation options aren’t always comfortable, or even reliable.

But these days, with gas prices going up and traffic becoming an even bigger concern, is it still worth the investment? Would owning a car end up being an unnecessary expense? Let’s find out!

Buying a car in the Philippines: Pros and cons

Owning a car in the Philippines comes with a lot of perks. First off, it’ll be much easier for you to travel around the Metro since you are in control of your time.

You can also easily find where you’re going, and you don’t have to memorize complicated bus routes or line up when you’re taking the LRT or the MRT. All you need is to turn on your Waze app, and you’re all set to go anywhere you like!

Basically, having a car gives you independence and convenience, as well as control over your time and where you want to go.

Sounds too good to be true right? Well in a way, it is.

Owning a car sounds great in theory, but there are a lot of things that you need to consider. Traffic in the Philippines is terrible, so that’s something that you’ll need to contend with on a daily basis. Sometimes traffic can also be unpredictable, so your regular 1 hour drive home can sometimes take 2  hours, maybe even 3 depending on how bad the traffic is!

Parking spaces can also be very hard to find, especially in business districts. In addition, parking slots can also be very expensive. In fact, some people even go so far as to park in a cheaper spot, even if it means they have to walk 10-15 minutes to get to where they’re going!

Another thing to consider would be rising fuel prices. With the TRAIN law, fuel prices are consistently going up. So you’ll have to make sure that your budget can handle the increased cost.

Lastly, you’ll also have to consider maintenance costs for your vehicle. Cars do break down, and they suffer from wear and tear. Neglecting regular maintenance can cause even more problems, especially if your car suddenly breaks down in the middle of the road. It’s really not worth the hassle to skip regular car maintenance checks.

Breaking down the costs

Is Buying A Car In The Philippines Worth The Expense?

Compared to other countries, owning a car in the Philippines is not super expensive. You can buy a lot of good quality cars that won’t break the bank.

How much does a brand new a car cost?

Let’s say you’re going to buy a Toyota Vios, a regular sedan from a trusted brand. The retail price hovers around 629,000 pesos, which is an accessible amount for middle class Filipinos.

Now, not a lot of people have 629,000 pesos on hand right away, so you’ll most likely get a car loan so you can pay off the vehicle. If you apply for a loan, you can get about 503,200 pesos from the bank. You’ll also need to pay 20% of the downpayment upfront, so you’ll need to have 125,800 on hand.

If it’s for a 5-year loan, then you’ll have to pay roughly 10,737 pesos per month. If you’re earning 40-50 thousand pesos a month, then the cost isn’t so hard on your wallet.

Next up is the cost of fuel. Gasoline is about 52.92 pesos per liter, and diesel costs 41.40 pesos per liter. In a year, expect to pay 40,000 pesos in fuel costs alone for a Toyota Vios.

Other expenses

There are also other costs that you’ll need to consider if you’re going to buy a car, as the costs don’t end with the car and fuel.

Of course, you’ll also have to register your car with the LTO, which costs 1,600 pesos for light cars, 3,600 for medium cars, and 8,000 for heavy cars. For AUVs you’ll need to pay 2,000 pesos and 2,300 pesos for SUVs.

Emission testing would set you back around 450 pesos, CTPL is 980 pesos, a regular plate costs 450 pesos, and stickers and other tags are roughly 50 pesos each.

Car insurance is also an important thing to have, as you never know when you’ll get into an accident. That will set you back another 10,000 – 20,000 pesos depending on the type of insurance.

Parking and toll fees are also going to be an added cost, and they can add up quickly. Let’s say you’re working in Makati, and going to the office for 20 hours a day. Then your monthly costs would be about 3,000 pesos to 4,800 pesos. Multiply it by 12, and expect to spend 36,000 to 57,000 pesos in a year in parking fees alone.

If you’re coming from other provinces near Manila such as Bulacan, Cavite, or Laguna, then you’ll be paying for toll fees daily. So that’s another expense you’ll have to consider.

Lastly, maintenance costs in a year would set you back about 7000 pesos.

Is owning a car in the Philippines worth it?

owning a car in the Philippines

Source: wikimedia commons

In a single year, expect to pay around 250,000 pesos if you’re getting the aforementioned Toyota Vios. That amounts to roughly 21,000 pesos a month.

That means that if you want to live comfortably and have a car, you’ll need at least 40-50,000 pesos as your monthly salary. If your current salary is below that, then it might not be wise to buy a car just yet since the expense really won’t be worth it.

However, in some cases, riding a Grab might be cheaper. If your roundtrip Grab ride costs about 700 pesos(which is pretty expensive!), then that’s 168,000 pesos a year. But it’s still way cheaper than the cost of owning a car in the Philippines.

So if you’re planning on owning a car in the Philippines, be sure that your monthly income can support it. It’s not just enough for you to be able to get the car, but you also need to pay the other costs and have enough for your monthly needs.

Owning a car in the Philipines is great, and it’s really good to be able to go anywhere you want at your own leisure. However, the costs can quickly add up and it can sometimes become an unnecessary luxury especially if you’re single and don’t really need a car.

That’s why it’s important to do your research and read up on the costs involved. After all, you don’t want to end up with a nice car, and end up selling it at a loss within a few months because you’re unable to pay your expenses!

 

Source: Cashmart

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