Average Australian now spends $17,606 on transport costs

Posted: 16 February 2018 9:23 am
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M7 Toll Road Sydney

An analysis shows costs have risen to 14.2% of household income.

Results from the December 2017 Transport Affordability Index, produced by the Australian Automobile Association (AAA), show transport costs have increased.

The average metropolitan home now spends $17,606 on transportation, amounting to 14.2% of the household's income. Regional households are spending $14,008, or 12.3% of total income. Expenditure on transport increased 0.1% on average since the previous index in September.

Costs often overlooked

The Index was first launched in August 2016 as a way to track transport costs. Initially only covering capital cities across Australia, the index was then expanded to include regional areas. The AAA aims to provide policymakers and media outlets with a quarterly costs snapshot.

However, even though transport accounts for a sizeable portion of household budgets, it is frequently overlooked during national debates on living costs.

“Price movements in electricity receive a great deal of attention but transport actually absorbs a much larger share of household income,” AAA Chief Executive Michael Bradley said.

“Unlike utility bills, Australian families do not receive all-encompassing transport bills every three months. The index highlights subtle movements in transport costs, which are otherwise easy to overlook."

Why are costs increasing?

Cost increases can be attributed to:

  • Higher fuel prices. Prices rose nationwide this quarter
  • The price of Comprehensive insurance. Insurance prices increased marginally in Western and South Australia.
  • Rising toll costs. Both New South Wales and Victoria reported higher toll charges.

Who's spending the most on transport?

Sydney remains the most expensive capital city, with average costs sitting at $22,291 per year, despite a $58 decrease over the last quarter.

The decrease came as a result of registration and Compulsory Third Party insurance reductions, following the Green Slip scheme reforms. Together, Sydney families saved $305 per year.

Unfortunately, the savings were offset by higher fuel and toll costs. The index found that fuel price hikes cost city households an extra $5.42 per week.

After Sydney, Melbourne and Brisbane are the next most expensive capital cities. Hobart and Darwin are the cheapest.

Wagga Wagga and Hobart were the only places to record lower transport costs, with inhabitants saving $80 and $24 respectively.

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