A must read for first time car buyers

Perodua or Proton? Brand new or pre-owned? Buying your first car is always exciting but can also be a pretty nerve-wracking exercise. Your first car is not going to be just a vehicle to take you from one point to another. The first car, for majority buyers, is more for utility than luxury. That aside, the first car also shapes the buyer’s viewpoint about cars in the future.

The median monthly income of graduates having a full-time occupation was RM 3,936 in 2018, up by RM 386 from 2017. Commercial banks usually offer a candidate automobile loans with a monthly instalment of up to one-third of their salary. The instalment amount is usually around RM 1,300. This means that graduates with a steady income can buy cars worth up to RM 90,000, putting like of Toyota Vios, Proton Saga, and even a pre-owned BMW 3 Series within their reach.

The cost of owning a car, however, does not end with buying. In fact that’s one of the several costs. Owning a car includes a number of other expenses like road tax and insurance costs. That aside, maintenance costs to keep the car in perfect running condition for its lifetime, tops the list. The cost of maintaining a car is probably most difficult to calculate since that widely varies between models. It increases as the vehicle adds years and is even more for a used car which is not covered under warranty.

New versus pre-owned

Entry-level cars like the Proton Saga, Perodua Axia and Kia Picanto are some of the most popular vehicles among first-time buyers. People earning more than the monthly mean salary also aspire for compact sedans like the Toyota Vios. New cars usually command a 10 percent down payment with a loan tenure of up to five years.
While pre-owned cars are not entirely an unworthy buying decision, buyers have to factor in some major costs towards premature component failure and other service expenses. On the flip side, first-time buyers can land an attractive bargain with reduced depreciation costs on pre-owned cars, if they find a vehicle in an almost new condition.

Many customers avail car loans that are transferable at the time of sale. It means that you can buy a pre-owned vehicle with an outstanding loan. While buying an used car, check its loan repayment record.

Proton is among the most popular cars in the Malaysian market. It means that repair garages have enough knowledge to service a Proton and spare parts are also less expensive. First-time buyers usually have a budget constraint and they are probably best off with a Proton.

Hyundai and Honda are the two other popular car brands in Malaysia, while Mercedes and BMW dominate the European car segment. Audi too is increasingly gaining a foothold in the Malaysian car market.

Fuel and other running costs

Calculating fuel costs is always tough for a first-time car buyer, particularly because each vehicle has a different powertrain. Some cars, overall, are more economical than others. Modern hybrid cars and those hauled by a turbocharged diesel engine are considered to be the most efficient. The naturally aspirated petrol motor is the most common powertrain among all classes of cars.

There are several ways to calculate the fuel consumption. The final figure can be calculated more accurately once you have established your typical driving route and after three months of owning the car. The total kilometres driven, divided by the amount of fuel you have used, will reveal the mileage cost.

Remember that the mileage number claimed by the manufacturer, in case of vehicles with internal combustion engines (ICEs), almost never matches real-life figures. Manufacturers peg the fuel efficiency number under a highly controlled environment. Factors like weather, traffic situation, road conditions, and individual driving styles are not considered while calculating the mileage.

A more realistic fuel expense chart, while not sacrosanct, is expected to be as follows.

Powertrain	Fuel consumption
1.0L to 1.3L	7.5 liters/100km
1.3L to 1.6L	8.5 liters/100km
1.6L to 1.8L	9.0 liters/100km
1.8L to 2.0L	9.5 liters/100km

Conservative monthly estimates put the cost of owning a Perodua Myvi at RM 1,171.34, while that of the Proton Saga is RM 1,005.50. The Toyota Vios typically has RM 1,184.54 ownership costs.

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