Car Ownership Cheapest in 15 Years, Study Shows

YERUSHALAYIM -
Eilat's port is the main entrance for ships carrying loads of brand new cars to be sold in Israel. Photo by Yossi Zamir/Flash90
Eilat’s car port. (Yossi Zamir/Flash90)

Cars are expensive in Israel, and so is gas – but both are cheaper now than they have been in 15 years, a study by a car industry umbrella group said. The result by the Cheshev group said that the annual cost of using a car in Israel had fallen from NIS 31,000 to NIS 28,000.

That translates to a cost per kilometer of NIS 1.88 for drivers who travel around the average of 15,000 kilometers a year. Between 2006 and 2011, the cost per kilometer was NIS 2.08 per year.

More dramatic was the drop in cost for fuel. In 2012, when gas was NIS 8 per liter ($7.26 per gallon), Israelis spent on average  NIS 11,400 ($2,923) to fill their tanks. Today, with gas prices at ten-year lows, that number has fallen to NIS 7,800 ($2,000). In 2002, it cost NIS 6,800 ($1,743) to fill a gas tank throughout the year.

However, the study said that the biggest factor in the reduced cost of car ownership has been a steady fall in the cost of insurance – both broad collision and theft protection insurance, and basic state-required insurance – for drivers. Last week, the Transport Ministry announced that new discounts in required basic insurance would be given to drivers with vehicles that have safety systems (such as collision-detection system MobilEye) installed in their vehicles.

Low interest rates mean that financing a car is cheaper today than it has been in a long time. Low rates alone have reduced the cost of car ownership for standard 1.6 liter engine models by 12 percent – and as a result, said the study, there has been an increase in sales for more elaborate models, such as mini 4×4 models (like the Nissan Juke) and larger engine “manager-style” vehicles.