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Monday, May 18, 2009

Getting on the road.

Today in suburban cities like Gurgaon, the supply of public transport is woefully inadequate for the daily commuters. Traditionally women, students and elderly have been more dependent on public transport and are hardest hit by failure of the public transport system. As our cities grow and public transport is not able to keep up, most people feel the need to own a vehicle. After a few attempts to use public transport, a daily commuter or suburban resident soon starts to evaluate which vehicle to buy and how to drive and maintain it.

In places like Gurgaon, it is not uncommon to see someone learning to drive a car that he or she has just bought. The requirement for a commuting solution is immediate and a new car owner is in a hurry to get up and running on the road. They have to quickly get up to speed on

-Learning to drive
-Getting a driving license,
-Deciding on the vehicle to buy
-Selecting and buying car insurance.
-Learning to maintain and protect your vehicle.
-Navigating and staying calm on the crowded roads of India.

The first milestone on this journey is getting your first driving license. The law is clear on this, “No person shall drive a motor vehicle in any public place unless he holds an effective Driving licence issued to him authorizing him to drive a vehicle of that particular category”.

There are two steps to acquiring a driving license and both involve a trip to the RTO office. First time you get checked for color blindness, take a simple objective type test and get a learner license issued. This license allows you to drive on the road provided you have someone with a valid driving license sitting along with you. Second time you return after learning to drive to get a Permanent license. This second visit should be within 30 days to 6 months of issue of learner license. You need to take your vehicle with you, demonstrate your driving skills, satisfy the examiners and become a proud recipient of a driving license. It is advisable to use a good professional driving school to help you through this stage.

At some point along the way you will also need to decide which vehicle to buy. Consider both second hand cars and first hand cars while comparing so that you get a full picture. While comparing various options, take into account the total cost of ownership per year to decide which fits your budget. A common mistake is to only consider fuel economy while assessing the ownership cost.

Total Cost of Ownership includes -

-Fuel Costs
-Insurance charges.
-Maintenance costs.
-Interest if car loan is taken.

Take the example of a new 4 lakh rupee car, which is driven 1000 km a month with a petrol fuel economy of around 15km a litre.

-Fuel costs – about 3000 rupees a month.
-Car insurance policy would be about 10 – 12 thousand a year, or 1000 rupees a month.
-Depreciation would be 5000 – 10000 a month, considering that the car value goes down by 15% to 30% in a year.
-If you took a car loan of 75% you might be easily paying 4000 a month in interest alone.
-Servicing and maintenance charges - About 800-1000 per month.

So fuel economy though important, is just one cost among many associated with vehicle ownership. Lets compare this with a second hand car bought for 2 lakh.

-Its fuel economy would not be too different from a new car.
-Its maintenance cost might be higher, say at 2000 rupees a month,
-Its insurance would be lower at 100 - 500 rupees a month since the car is of lower IDV (insured's declared value)
-the depreciation would be lower for the same reason.
-You might be able to buy it without needing a loan.

You have to choose between having the greater reliability of a new car versus the lower cost of ownership of an older car. The prestige value attached to a new car may tilt your decision. On the other hand you may want to commit the beginner's mistakes, minor accidents, clutch plate burnouts on an older car and so opt for the latter.
Now that you have your car and your license, its time to get on the road and drive on towards a different lifestyle. Make sure you have the contact numbers of your dealer and service network with you and don't hesitate to call for help when facing any problems on the road. Inspect your car from time to time, by walking around it, bending down and looking at the undersides, kicking the tires and lifting the bonnet and having a look at the engine.

Your car is a machine that will carry you at high speeds in dense and chaotic traffic and you should tend it with care. Avoid unnecessary manoeuvres on the road, aim to protect your car and your car will protect you. Renew your insurance on time and never drive when you don't feel fit enough. Check the engine oil and coolant levels regularly and get the tires air pressure checked routinely. Ignore distractions, keep your focus on the road, stay cool and always wear a seat belt.

When one is commuting by bus one looks at cars and thinks they have it easy. When you own a car and realize its responsibilities, you may end up looking at the people riding on buses and thinking that they have it easy. No stress of driving, no worries about accidents and maintenance and no hassles over parking. Don't worry when you sit in your own car, turn up the music and rev up the engine all these thoughts will disappear as you get on the road and get going.

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