For that typical mid-range sedan driving 15,000 miles a year, this works out to about 70 cents per mile. For a higher end sedan, it’s about 90 cents per mile. If you’re in a BMW 700 series, you should expect about $1.33 per mile. And for that Escalade, it falls back to $1.15. So for your daily commute just plug the route into Google Maps and multiply.
For my five-mile one way, I'll bet on a $5.00 one-way cost. UberX would get me there for $11, and our local cabs for about the same. My workplace is a free parking zone so I don’t have to add in anything for parking. And I have no tolls or other costs to contend with, but what about you? The obvious answer here provokes a little more work with the calculator to see what the break-even figure is. In many cities, ditching the car and dialing up a ride service every morning is the easy and obvious decision. And that’s before taking into account the cost and inconvenience of a periodic accident, and days at the regular check up shop.
But hang on there. What if I have to run further out of town for the day? Renting a car is now about $35 / day with unlimited mileage, and no shopping around. Not a bad outlet for the special run to the country or to pick up some large purchases.
So what are the trends now? On the anecdotal evidence side, I suspect we all know Millennials in New York, Chicago, or San Francisco that already get along quite well without a car. These crowded and overpriced locations are ripe for this approach since pretty much everyone can feel the math intuitively. Worldwide, the World Economic Forum notes that in some major cities, led by Boston, car counts are declining significantly even as the population rises.
So take a look at your world and check your assumptions. Does owning and operating a car continue to make sense? At what point might you actually consider the switch? Think even about re-allocating the capital to some investment and including that expected return in your calculation—getting closer?
As for me, while I’m seriously considering it, I’m not quite ready to tip over. I do strongly think that using cabs or Uber to head out to dinner with friends is a no brainer, especially if there are a few drinks involved. But it may be a year or two before I make extra room in the garage.