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Is Buying an Electric Scooter A Better Idea Than Buying a Car?

The petrol station across the road from our warehouse is currently selling 95 octane petrol for $2.13 per litre. Even diet petrol (E10) is going for $1.99 a litre. And if you want to fill up on Diesel, make sure you stop past a bank on the way to get a small loan. 

It's a sad state of affairs for most Australians unless you own shares in oil companies, but this got the team at Electric Kicks wondering...

Is it a better long-term financial decision to buy an electric scooter instead of a car? 

We cracked out a whiteboard, an abacus & jumped on Google to find the answer to the most crucial question of the year. 

The Short Version

If you religiously use your car for commuting, or you’re only looking to buy a car to shorten your commute, an electric scooter is a significantly cheaper alternative. If you’d like to read more about the research, findings, and links to all sources used, click here.

As the average car in Australia is paid off over 4 years, the table below summarises the costs of running an electric scooter vs. a car over a 4-year period. 

Dimension

Car

Electric Scooter

Upfront Purchase Cost 

$39,260.69 (with 4 year car loan at 6.5%)

$2,099.00

Petrol

$9,165.40

-

Electricity

-

$196.86

Registration

$1,396.00

-

Insurance

$4,881.60

-

Servicing

$1,262.00

$600

Accessories

-

$588

Parking

$39,926.40 

-

Public Transport

-

$5,016.96

Total

$95,892.09

$8,500.82

Fig. 1 - Cost of Owning A Car vs. An Electric Scooter Over 4 Years.

The Longer Version

If you’re one of the 7 in 10 Australian workers that drive to work each day, the average cost of filling your car up with petrol probably makes your eyes water. With costs getting so high that even the government stepped in to try and control the situation before giving up shortly thereafter, recent times have worked largely in favour of alternative modes of transport.

We have seen a significant increase in searches for electric cars, but as nice as electric cars are, they remain on the wrong side of expensive for most Australians. 

interest in electric cars in australia across last 5 years

Fig. 2 - Interest in ‘Electric Cars’ in Australia over past 5 years

Even the cheapest electric car in Australia is $46,900 Drive-Away and that’s the BYD Atto 3 (don’t worry, we haven’t heard of it either). That money won’t get you a lot of car, however, particularly when you consider what that money would get you if you stuck with their petrol-driven counterparts. 

So what are our options? 

Walk? Cycle? Public Transport? 

Each has their merits, but, truthfully, none are good enough solutions on their own. If you live more than 2KM from your work, walking isn’t really suitable. Cycling requires cycling clothes, storage space, and unless you’re one of those people who adamantly believes you don’t smell when you sweat, you’ll also need shower facilities. Convenient? It is not. 

So public transport seems to be the best alternative, but given that most people have become quite comfortable staying 1.5 metres away from each other over the past two years, it’s understandable if you want to avoid it as much as possible. Plus you still need a way of getting to the station as well. 

It’s obvious that this problem can’t be solved.

Or can it? 

When lockdown ended & we were released from the oppressive shackles of pretending to care about each other, many of us were quick to resume our daily trips to work, and during that time thousands of Australians discovered the exciting world of electric scooters. 

While state governments break out the parchment to see how 50-year old laws can be crowbarred to regulate this new form of transport, many of us are seeing just how valuable an electric scooter can be. 

Electric scooters are great fun. They are convenient. They are portable & practical. But are they a smart investment when compared to a car? That’s what we’re here to find out. 

Before we begin, a disclaimer: we aren’t financial advisors. We sell Electric Scooters. There are a lot of variables when making these calculations, so while we’ve tried to provide the best averages we could find and link to all source data, we fully expect that some of you may have totally different experiences. 

The Average Cost of Buying a Car in Australia

According to Canstar Blue, the average price we pay for a new car is $40,729. GoAuto, the automotive industry’s leading source of news, tells us that used car dealers are selling their cars for an average price of $33,000.

That means the average price of a car in Australia is $36,864.50. 

There are some great savers in Australia, but 90% of new cars are purchased with finance, and overall, about 20% of vehicles in total are bought under some sort of loan, so let’s assume that you don’t have $36,864.50 to drop in one go. The average car loan interest rate is approximately 6.5%, and the average length of a car loan in Australia is 4 years.

This means that to buy a car with a loan and pay it off over four years, you’d be paying $9,815.17 a year just to own the vehicle. You haven’t even turned the key yet.

The Average Cost of Running a Car in Australia

At the time of writing, the average cost-per-litre of 95 octane petrol is $2.05, currently the highest we’ve seen in the past 5 years

With an average fuel efficiency of 11.1 litres per 100km travelled, this means that filling your car with enough petrol to drive 100KM will cost you roughly $22.76

petrol prices in australia across last 5 years in usd

Fig. 3 - Average cost of petrol in Australia (USD)

According to Budget Direct, the average car drives 13,301KM each year, meaning that to fuel the average Australian car with average Australian petrol over one year will cost you $2,291.35. 

Other Car Ownership Costs

Car insurance costs approximately $1,220.40 each year, average vehicle registration costs $349, car servicing runs up roughly $315.50, and if you pay for parking when you commute, you wouldn’t be surprised to fork out anywhere between $5,000 - $10,000 a year in parking fees based on a weekly parking spend of $207.45 across 48 working weeks (52 weeks - 4 weeks of annual leave).

Adding all that together, the average annual cost of car ownership comes out anywhere between $18,991.42 and $23.991.42.

Let’s say you decide to do away with the peace of mind that comes with insurance and servicing, and you are fortunate to be able to park for free at your work, you’ll still be looking at forking out $12,455.52 a year for the luxury of driving to work.

And that cost is set to go up. Increasing fuel costs, scarcity of used cars, erratic stock market behaviour, and increasing taxes all promise to send car ownership in Australia the same way as home ownership in Australia - possible, but notably less common than previous generations. 

The Total Annual Cost of Owning A Car

Car Cost (With Loan)

$9,815.17

Petrol

$2,291.35

Insurance

$1,220.40

Rego

$349

Servicing

$315.50

Parking

$9,981.60

Total

$23,973.02

 

With an average of 13,301KMs driven each year, this means the cost per kilometre of owning a car is $1.80.

While we all know the benefits of owning a car, this is still a significant annual cost. Even if you were to pay 100% up front for the cheapest car currently available on Carsales.com.au that doesn’t need mechanical work (a 22 year-old Kia Rio with ¼ million KMs on the clock for $1,500), you’d still be spending at least $5,676.25 in the first year before parking costs. 

The Average Cost of Buying an Electric Scooter

The average up-front cost of purchasing an electric scooter from Electric Kicks is $2,099. While a variety of payment options are available, they all need to be paid off in one year, so the upfront and annual costs of buying a scooter are the same. 

The Average Cost of Running an Electric Scooter

The first cost to consider is how much electricity is consumed charging an electric scooter. Australians can expect to pay roughly $0.27 per kWh for electricity just now, and the average battery capacity of our scooters is 0.97 kWh. That means to fully charge an electric scooter will cost roughly $0.26. 

The average range of an electric scooter varies quite dramatically, but you can expect approximately 69km on a single charge. This does mean that to cover 100km you’ll need to charge the scooter 1.45 times, bringing the cost of running an electric scooter for 100km up to $0.38.

That’s just 1.67% of the cost of fuelling a car over the same distance.

To charge a scooter enough times to cover the same 13,301KM your car would drive, you’d expect to give your electricity provider $49.21 per year.

Servicing Your Scooter

Like any form of transport, you should service your scooter annually. This is largely a test of the battery, checking the tyres & brakes, and making sure all cables are adequately tightened. At Electric Kicks, this would probably set you back about $150

Insuring Your Scooter

At the moment, there aren’t a great deal of companies that will insure an electric scooter. Some cover it under contents insurance. Some insure the item on the conditions you never use it for anything fun or worthwhile. Some simply don’t acknowledge their existence. For this reason, there aren’t a great deal of options here, so we haven’t factored insurance into the cost of running a scooter. 

Registering Your Scooter

Scooters don’t need to be registered (yet), so there is no cost here. 

Accessories

Like any rideable form of transport, you’ll need a few accessories:

  • Helmet - $150
  • Light - $199
  • Lock - $119
  • Bag - $70
  • Phone Holder - $50

Fortunately, these don’t need to be purchased over and over again unless you damage or lose them, but we’ll add this total cost of $588 to the annual cost. 

Public Transport Costs

public transport in australia

Weather is unpredictable, and electricity & water don’t go well together. When the rain starts you will, sadly, need to find another form of transport. However, scooters generally fold up and can be taken on trains, buses, & trams. 

Some commutes are a little too long to be scooter-only journeys, so let’s suggest that you ride from your house to the closest train station each day, catch the train to the city, then commute from there to your workplace. 

Nine News put the average monthly cost of public transport in Australia at $104.52, so using public transport to commute each day would cost you approximately $1254.24 a year. 

The Total Cost of Scooter Ownership

Adding all that up, we get the following:

Scooter Cost

$2,099

Electricity 

$49.21

Servicing

$150

Accessories

$588

Public Transport 

$1,254.24

Total

$4,140.45

 

Referencing the 13,301KMs your scooter would need to cover, the cost per kilometre would be $0.31 for the first year, and that includes using public transport every day. If you were able to commute without needing to take the train, that cost would be $0.22 per KM.

Time is Money

What we haven’t covered so far is time. Cars have one significant flaw, and that flaw is other cars. They are limited to roads, and traffic is a mounting concern. The average length of a standard commute is increasing, with the common Australian spending the equivalent of 6 working weeks commuting each year. 

Something cyclists discovered a while ago is that not having to use roads or being able to use cycle lanes actually means you can often get to work much quicker if you don’t drive. As mentioned, cycling has its drawbacks, but those drawbacks are largely removed with an electric scooter, meaning you get the same time-saving benefits with none of the effort.

It’s difficult to put a dollar value on time saved, but we’re going to attempt some loose logic. 

The average Australian gets paid $36 per hour. For our purposes, this means one hour of our time is worth $36 as far as the wider world is concerned. Boiling this down, this means one minute of our time is worth $0.60. 

In our case, this means that for every minute saved, you’re actually “saving” $0.60. Of course, you won’t see that figure in your bank account at the end of the year, but this equates to an extra few hours every week with your family & friends. This equates to an extra half hour in bed each morning. This equates to an all-round better work-life balance, and it’s difficult to put a dollar value on that. 

Costs When Not Being Used

parked cars

Your car will spend most of its time doing nothing other than attracting the ire of birds with IBS, but you’ll still be paying for that luxury through registration, insurance, and loan repayments. Unless you let these expire and lock your car in the garage, which somewhat defies the point of owning a car, you’ll be paying for your vehicle whether you use it or not. What’s more, should you decide to put your car back on the road, you could be slapped with a road-worthy charge if you’ve left it too long. 

Simply unplug the electric scooter from the wall, fold it up, and put it in a cupboard. Or frame it as a conversation piece in your living room. Regardless of what you do, there are no ongoing costs of owning a scooter in the event you don’t use it, but we would suggest you look at a service if your ride sits unused for a few months. 

The Legality of Electric Scooters

Of course, none of this helps you if you are unfortunate enough to live in a state where electric scooters are still relatively illegal to use in public (NSW, for example). That said, electric scooter trials are occurring all over the country, and with a general push towards more sustainable ways of getting around, states that run trials tend to open up their regulations shortly afterwards. While you may not be able to take advantage of an electric scooter now, it’s only a matter of time. 

In any case, electric scooters are available to be purchased in any state regardless of the laws, and you can use them on private property. While a reputable company such as Electric Kicks would never suggest you ignore local traffic laws, we have heard it said that as long as you’re riding with a helmet, while sober, following speed limits, and not terrorising pedestrians, you’ve got a good chance of not getting in trouble*.

Is There a Healthy Middle Ground? 

Yes, actually. A few of our customers have done one of two things:

- bought a cheaper car than they were originally expecting, and used the savings to buy an electric scooter. They cart the scooter around in the back of the car until they find cheap or free parking, then finish their journey on their scooter. This is actually a good balance of both worlds: you get the practicality of owning a car, but you can avoid using it for expensive tasks that can be easily accomplished for a fraction of the cost on a scooter. 

- scrapped the idea of owning a car altogether, bought an electric scooter, and signed up for a pay-as-you-go car service such as goget.com.au or carnextdoor.com.au. This way, you avoid car ownership costs altogether, simply paying for those occasions where a scooter simply doesn't cut the proverbial mustard. 

So Should You Sell Your Car and Buy an Electric Scooter?

should you buy a new electric scooter instead of a car

Communicating context through the power of badly-made memes

This is all well and good, but let’s be real for a minute: this isn’t really going to happen. Benefits of car ownership extend beyond a more comfortable commute, and most Australian families are going to need a car. But with the cost of owning one going up, if you’ve been considering buying a car for commuting purposes, then buying an electric scooter is a genuine alternative for you. 

Even if you own a car already, using an electric scooter commute lets you save your petrol for journeys that actually need a car - school runs, doing the weekly shop, visiting friends & family, & transporting goods. For everything else, you can use your scooter. 

Electric scooters are never going to replace cars altogether, although there will be a few among us who simply don’t need a car, but would still like a way of getting around. In fact, a large portion of our customers purchase a scooter simply to get them around their local area, or knock a few minutes off their commute. 

With the costs of just keeping fuel in your car set to increase forever, an electric scooter can help off-set that cost, while saving you time each day and giving you a genuinely more enjoyable commute.

*Electric Kicks takes no responsibility if you get arrested or fined for riding your Electric Scooter in a state where they are currently not fully legal. That’s on you.

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