Bangernomics - when it doesn't make sense. I bring you the FIAT 500.

Bangernomics to me is the art of running a car as cheaply as possible. The only rule being that it has to be safe; good tyres, brakes and not be a rusty mess. Actually add an "ish" onto safe back there - my car is 23 years old [a Volvo 360GLT] so safe is all relative isn't it? To achieve cheapness means minimising on depreciation [appreciation if possible] and not taking out a loan to buy the thing in the first place. Interest is badness.

Now I'm not doing it for "save the planet" reasons, and neither am I doing it because I cannot afford a new car. Anybody these days can get behind the wheel of a new car; just sign on the dotted please. I'm doing it purely as an exercise really; I want to see if I can beat the £18 per day train fare to London. People go "oooh" at the £18 ticket price, and state that that is expensive. But it isn't really. Indeed it's pretty cheap when looking at solo travel car costs. If I am lucky this year, and don't have to scrap my current banger, my equivalent banger-to-London costs are £14 a day. Just a coffee and muffin in it really. Not much. However, the train is massively cheap compared to using a car where there is depreciation and interest charges to add in. If I had pay £200 a month in repayments for a car loan, my daily costs would be nearer to £30. The train would be £12 cheaper. That's lunch, a mid morning coffee and cake, plus perhaps a magazine to read. Big difference.

So what are my costings here? Obviously I already own the car; it only cost £300 three years ago, so it doesn't owe me anything, and neither do I have an outstanding loan against it.

My car cost £30 to fill up today, at £1.29 per litre, so I'm using £30 of fuel per week; about 25mpg then. £120 per month, £1,320 per anum. Repairs cost around £400 per year, insurance £220, road tax about the same. £50 for an MoT. My £300 banger is costing me £1,990 - gosh, let's be mad and call it £2,000! - per year to run.

However there are no interest charges to pay and neither is there any depreciation. It was a crap car when I bought it, and it'll be a crap car when it finally dies a miserable death. As scrap it's worth £80, but as a parts car for an enthusiast probably £200. Remember I only paid £300 for it three years ago. Cheapness abounds here.

But £2,000 per year to run it isn't good. I'm a cyclist; I don't like that kind of expenditure. Bike money that is. Can I do it better? Cycling is out; almost 20 miles to work over some big hills and I'm pushing 50 soon. And really, the A23 isn't my idea of a bike ride.

Today I saw an advert that made me think. Fiat are pushing the 500 at £129 per month, at something like 3.4% APR. Now that just pays the depreciation; you don't buy any bit of the car for that. After three years you still have to give them £4,000 or walk away from the deal. So straight off you've lost £5,000 over three years.

But it'll do 48mpg. Call it 50mpg average then. Twice what my banger does. My fuel bill per year would be halved to £660. No MoT for 3 years, £30 road tax and no servicing costs for perhaps two years. Insurance would be cheaper too. I figure the Fiat 500 1,200cc Pop would cost me £1,385 per annum less to run than my banger [excluding repayments].


There's always a 'but' here in Muddy Ground. A £129 per month repayment plan is £1,548 per annum. £660 petrol, £30 road tax, £100 insurance equates to £2,340 per year running costs. So my banger still saves £400 per year even though it does poor mpg. At the moment petrol would have to rise 30% from current levels to make the new car a deal, or my banger fail an MoT so bad it has to be binned. And to be honest the Fiat would only get 48mpg if I drove Saintly. I've heard that actual mileage can be down to 38mpg if you drive it with a bit of fun in mind. If I'm going to embark on driving with a view to saving fuel, I bet I could get 32mpg from the Volvo if I didn't race everywhere. If I drove the Volvo as Volvo intended, my fuel bill would drop by 25% to just over £1,000 per annum at £1.29 per litre. The Fiat now starts to look expensive again doesn't it? Especially as the deposit is £1,000....

The deposit alone is 6 month's motoring to me. Just call me cheap will you?

Dear Reader, of course, you are correct; I could buy a £2,000 car of around 1,000cc and be better off than I am now in terms of mpg. But then depreciation becomes an issue. A £2,000 car now would be a £1,600 one in a year.... Plus my banger has gone through the "everything is knackered, so I replace bits to keep it going properly" stage. The steering is knackered, as is the suspension but it's all so far gone there's no point replacing it. Buy into a 5 to 10 year old car and one would feel duty bound to maintain it properly. Maintenance costs money.

So for now my sub 25mpg car is the cheapest option available, but by crickey that new car is tempting. Pity the rear seats are for show only, and it's almost £10k in the first place for a small 1200cc car. Wonder what deals Renault are doing on the Twingo? A new car for £99 per month finance, and doing something like 50mpg, would kind of blow Bangernomics out of the window with current fuel prices.

And yes, you can get banger or classic cars that do more mpg than my car does, but they generally have tidgy little engines. If you're running a car it should at least be able to keep up with modern traffic without thrashing the nuts off it. A Renault 5 with a 1400cc engine may well be the answer here in Bangernomics land. An equivalent priced Micra would just smell of pizza or curry home deliveries wouldn't it?

But do you know what? My car isn't actually that bad a place to sit in. It is horrid to look at, but when you are inside that doesn't matter does it? Indeed every so often I pop into car showrooms and figure which one I'd buy - we have bought new for the past twenty years, and we're not on our uppers so can still play that game. Most cars these days are dark places to be sat in, and few have interiors that are pleasing to the eye. The Fiat 500, the MINI, and, well, that's about it for me up to about £20,000. I'd not spend more than £20k on a car.

And without wishing to sound like an old codger, but I don't like the feel of electric power steering. Bit dead isn't it? My Volvo isn't exactly a Lotus, and the steering is knackered, but it's still fun to pilot. We bought a Honda Jazz new when they first came out, and I always preferred the steering on my bangers. Our current Renault Scenic is better, but still miles away in terms of feel.

Comes to something in life when depreciation on a new car is less than the cost of fuel you're putting into it though doesn't it?

26/02/2011: Update.

Wow! How odd, we just happened to be driving past the local FIAT dealer today - it's down a dead end road ten miles from home so how that happened is beyond me. Anyway...

I want a baby blue FIAT 500 so bad it hurts!

There. I've said it.

Bangernomics is all fine, but I'll be dead one day. Up in Heaven or wherever, sitting around in the pub, everybody else laughing at all the happy times they had in their 500, me sitting there in a grouch over my £300 Volvo.

I know the 500 has a 155 litre boot, and is utterly pointless, but well most things in life are pointless aren't they? I'm going to have some fun with a car for the first time in 20 years since I sold my last MG Midget.