Car use soon to cost average family $100 a week

The cost of filling a car is steadily increasing. File picture / Greg Bowker

Rising fuel costs are becoming a major bugbear, with a survey released by online lender Wizard Home Loans today showing petrol prices are hitting consumers' hip pockets more than high interest rates.

Mortgages have traditionally taken up the lion's share of New Zealanders' incomes, but 74 per cent of respondents to the Wizard survey said rising fuel costs now hurt more than a Reserve Bank rate hike.

Wizard director John Grant said 70 per cent of respondents reported increases at the pumps had driven changes in spending patterns, with many choosing to stay at home, walking more, taking public transport or spending less on luxuries.

Over 1500 home owners were surveyed.

The survey came as economic thinktank the New Zealand Institute of Economic Research (NZIER) forecast the cost to an average family of keeping their car on the road would swell to $103 a week by next year.

A soon-to-be-released study by the institute showed the average family, earning between $47,300 and $58,900 a year, spent $53 a week to keep their car on the road in 2001.

That included petrol, insurance, maintenance and other costs.

In 2004, vehicle-related costs increased by just $1.

But the NZIER's latest study -- based on Statistics New Zealand's Household Expenditure Survey -- forecast that by next year, the average weekly spend would likely double to $103.67.

For high income families -- earning over $120,000 a year -- costs would more than double from $80.80 in 2001 to $210 in 2007, NZIER director Brent Layton said.

In 2004, those families spent $103.60 a week in vehicle-related costs.

Mr Layton said those on middle incomes would likely feel the impact of rising petrol prices a lot more.

"When you get up to $120,000-plus you probably wouldn't notice it, but if you are in the middle income range it is probably more significant."

Mr Layton likened the current high fuel prices to the fuel shortages in the 1970s that resulted in carless days.

"It is starting to get up to that level, in terms of the real cost of fuel. But we are also richer than we were then," Mr Layton said.

NZIER will release its full report on fuel costs in a fortnight.

Anecdotal evidence shows more people are already using public transport as petrol prices have swelled to a record $1.70 a litre in recent weeks.

- NZPA