How ditching the car could save you $10,000 a year
In the 1980s, Margaret Thatcher reportedly said that any man over 25 who ends up on a bus “has wasted his life”.
Doubt has long been cast on the veracity of this joke, but the negative perception of public transport users has crossed the Irish Sea.
As the Irish became more prosperous during the Celtic Tiger, we invested our money in cars: Ireland, which had one of the lowest car ownership rates in the European Union at the start 1990s, has become the second most car-dependent country in the EU.
But the changes needed to tackle the climate crisis mean fewer people are likely to own a car by the end of this decade.
The latest climate action plan aims to reduce the total distance traveled by car by 20% by 2030 in order to reduce emissions from transport by 50%. And a generational shift in car use is already underway, with an ESRI survey in November finding that a quarter of 16-24 year olds don’t even plan to own a car in the future.
Indeed, owning a car is getting more expensive, thanks to carbon taxes, rising fuel prices since Russia’s invasion of Ukraine, and rising car prices.
The average annual cost of running a family car in 2019 was nearly £10,700, before the pandemic and the war, the latest AA Ireland survey showed, making a car the second biggest expense for a household after their mortgage or rent.
As the cost of living crisis continues, could you ditch your car – or even the family’s second car – and save a big chunk of cash? If you live in an urban area and don’t depend on your car most of the week, here are some new ways to get around without a car.
An e-cargo bike
The government has sought to encourage the use of electric cargo bikes – which can haul heavy loads like groceries and children – as an alternative to a second family car by introducing a tax incentive in the government’s finance bill. last year which raised the threshold for e-bikes in the Cycle to Work to €3,000.
This means that starting January 1, you can purchase an e-cargo bike worth €3,000 through your employer and the cost of the bike will be deducted from your pay before taxes, USC and PRSI. You then reimburse your employer in installments within 12 months.
Since the cost of the bike comes from your pre-tax salary, you are effectively buying it for half price if you are subject to the highest income tax rate.
Although the tax incentive also applies to regular cargo bikes, an e-bike helps you tackle hills and headwinds without arriving at work sweating. Unlike an electric vehicle, you don’t need to pay vehicle tax or insurance and you can get a full charge for around 1c.
Keep in mind, however, that the significant tax incentive reflects the fact that some e-cargo bikes can cost as much as some used cars, but without the hefty extra costs. Prices typically range from €3,000 to €7,600 before tax relief, which is not available to freelancers.
The National Transport Authority plans to roll out a “bicycle library” in schools to allow potential commuters to try out a cargo bike before investing in one.
“In rural Ireland there is not yet a safe cycling infrastructure to use them, but in cities like Dublin e-cargo bikes could be a solution for people to give up their car or their second car,” says Dr. Brian Caulfield, associate professor. and Head of Discipline in the Department of Civil, Structural and Environmental Engineering at Trinity College Dublin.
In Galway, one of Europe’s most congested cities, Gráinne Faller and her husband Steve have covered 4,000 km on their e-cargo bike since they bought it a year ago to avoid getting sit in traffic while taking their two children to school in Knocknacarra from their home in Salthill.
The family car has ‘picked up moss’ since, as they only used it ‘a few times’ to visit Steve’s family at Greystones.
“It looked like a lot of money to pay for a bike, but it really became a replacement for the car,” says Faller, who, like her husband, works from home.
“It’s a lot cheaper to run. We plug it into the charger every other night and it charges overnight. We also have a folding electric bike and we are GoCar members as there is one parked near us and we would like to have that option in case one of the children gets really sick. We hope to stop owning a car altogether.
Car sharing services
If you live in a big city, a car-sharing service could fill the gap for trips like a department store in a DIY store or a visit to family in rural Ireland. GoCar, Ireland’s largest car-sharing company, is available at over 750 Irish locations – including Mayo, Kerry and Westmeath – with 900 cars and vans available to book by the hour. To use the service, register as a member, reserve the vehicle on the app, unlock the car with your phone and remove the keys from the glove compartment (some vehicles are keyless). You are covered by GoCar insurance and taxes while driving.
The cost of renting a GoCar starts at €10 per hour (or €54 per day) for a small car like a Renault Clio, while an SUV like a Hyundai Kona costs €12 per hour, or €65 per day. If you exceed the free driving allowance by 50km you are charged 50c per km. However, if you book the car for more than six hours, you only pay 20c per km.
The Yuko Toyota Car Club, which uses a hybrid fleet, operates similarly but is only available in Dublin. Prices start at €9 per hour (€58 per day) for a Yaris. You receive 50km of free fuel each day and are charged 25c per km thereafter.
There’s also the option of Fleet, a peer-to-peer car-sharing app that’s been dubbed “the Airbnb of car rentals” to allow motorists to rent their car when it’s not used. You search for locally available cars, enter your dates on the app, request the rental from the owner, then arrange pick-up. Car owners set their own daily rate and every Fleet rental is covered by insurance.
Automakers and distributors are increasingly shifting from selling cars to leasing their fleets through pay-as-you-go platforms to subscribers to generate additional revenue.
For example, Fleet powers the Toyota Dealer Rental app in Ireland, which lets you subscribe to a vehicle from a local dealership for anything from a day to a few months. Each dealership charges their own prices; in Ashbourne, Tadg Riordan Motors says its prices start at €47 per day.
“It’s like a Netflix subscription,” Caulfield explains. “You might need a car for three days during the week and a bigger car for a weekend.”
Keep your non-complaints
Going without a car would save you a bunch of insurance premiums, but if you turn around in a few years and decide to buy another car, the repercussions could prove costly.
Indeed, you risk losing your bonus-malus (AON) if you stop driving and do not take out new car insurance within the next two years, because insurers take into account the freshness of your driving experience when they give you provide a quote.
However, there are ways around this, especially if your spouse keeps their car, says Jonathan Hehir, managing director of City Financial Marketing, the broker behind online insurance brands including Insuremycars.be. You could become a named driver on your spouse’s car policy for free if you both have a full license and an NCB.
“You won’t get a quote from an online platform if you decide to hit the road again, but you can call a broker and they’ll get the deal from one of their insurers,” says Hehir.
“For someone who is unmarried and has given up their car because they are going to cycle and use the Luas, it would be difficult to get a reasonable quote after reaching the two-year bonus-free period. But if you called a broker, we’d call the insurance companies and say, “John’s been on the road for seven years, sold the car because he’s going to ride a bike, and now he has kids and wants to get back on the road.” In most cases, as long as his reasons are legitimate, they would give him three out of the five years of his no-claim remission. Doing that is no longer the end of the world.
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