Sat, Jul 04, 2009

Washington

Gas-pain ills spread to all costs tied to cars

By Dan Caterinicchia
THE ASSOCIATED PRESS
Tucson, Arizona | Published: 05.26.2008
WASHINGTON — Does filling the gas tank leave your wallet empty and your spirit sputtering? Get used to both, because practically everything car-related is costing more.
From oil changes to parking-lot fees, sticker shock will make this summer even stickier.
"Everything is more expensive," said Raj Amber, a partner at AAA Limousine in Alexandria, Va., bemoaning the recent oil-change-cost increase to $30, up from $25.
Amber's frustration is common among consumers facing $4 a gallon for gasoline, $45 a day for car rentals that cost $31 last year, and bigger bills from mechanics, tire shops and parking garages. Cost-fighting tactics are split: vigilant tuneups to stave off new-car purchases or bare-minimum crucial fixes combined with a hope-for-the-best mentality.
Fuel remains the single biggest expense for car owners over the lifetime of a vehicle, at about 30 percent of costs, followed closely by depreciation and insurance. But the prices for maintenance and repairs, which combined account for less than 10 percent of an automobile's costs, are creeping up.
The AAA travel club estimated that the average cost of owning and operating a car in 2008 will be $8,121, up from $7,823 last year.
"Purchases I'm making for our cars now are all driven by a preventative mentality," said Tony Farrell, a freelance writer in Richmond, Va., who has a 2001 minivan and a 20-year-old Honda Civic he had considered selling. "A year ago, I would have let it run ragged. Now I want that car in good working order because I want it to last."
Mirwais Niaz, manager of a Midas car-care franchise in Arlington, Va., said many customers are opting for the most basic repairs, trying to buy time and save for more expensive work.
For example, a recent Midas customer whose car needed extensive brake work told Niaz, "I don't care about the squeaking; just do something so the car stops." Another customer, whose car needed a transmission-fluid flush, asked if it could last another three months without the $159 service, since gasoline prices had sapped his funds.
Jiffy Lube has seen its car count drop by roughly 2 percent in the last year as gas prices have surged and new-vehicle technology gives drivers a better idea of when maintenance is needed, said Lisa Carlson, global director of marketing for Jiffy Lube International.
The dollar's decreased value, which makes imports more expensive, is an important factor in rising prices of oil, steel and other raw materials used in auto parts, said Harry Veryser, an economist at the University of Detroit Mercy and a former chairman of an automotive-parts supplier.
One spot of relief is auto insurance. Rates have remained steady or have fallen in many states because insurers are losing less money on claims and face competitive and regulatory pressures to avoid rate increases, said Donald Light, senior analyst for the Celent research and consulting agency in San Francisco. If high gasoline prices prompt less driving, accidents — and insurance rates — should drop further, Light said.
In big cities, drivers are finding it more expensive to park. An annual survey by Collier's International, a real estate services provider, found that daily parking rates rose in 2007 for the fourth straight year. The company expects the trend to continue this year.
But Benjamin Sann, founder of Bestparking.com, which tracks rates in Boston, Manhattan, Philadelphia and Washington, said more companies have dropped prices recently as they struggle to attract and maintain business.
And some other automobile-related businesses are trying to avoid passing their rising costs on to customers.
To keep his best limousine clients, Amber has not yet raised rental rates but has been forced to include a fuel surcharge of up to $5 on some trips. Customers, he said, "are not happy."
Midas stopped advertising prices for promotions among its 1,700 shops in the United States and Canada after a deal on brakes last year was found to be too low in busy metropolitan areas and too high in more rural locations, said Bob Troyer, director of corporate affairs at the company's Itasca, Ill., headquarters. Prices are set by individual owners based on their costs and local competition.
Despite motor-oil costs rising 15 percent in recent months, Niaz has maintained his Midas location's prices to remain competitive and meet any local promotions. Visible from his front desk is an Exxon Mobil station where regular-grade gasoline was selling for nearly $4 a gallon.
"I'm complaining myself," said Niaz, who recently spent $62 to fill up his four-cylinder Toyota Camry.