News

AAA Index shows transport costs increasing

7.11.2016

The Australian Automobile Association (AAA) today released its latest Transport Affordability Index which shows that in the three months to September 2016, rising costs have seen the average family in Australia spending around $16,894 a year on land transport, an increase of $116 per year.

Nationally, transport costs as a percentage of income also increased slightly over the September quarter to 13.4 per cent (up from 13.3 per cent). In comparison, household expenses relating to telecommunications, electricity and water consume one to three per cent of household budgets.

AAA Chief Executive Michael Bradley said: “The latest Transport Affordability Index shows transport costs continue to steadily increase, creeping up in both dollar terms and as a share of the household budget.

 “It’s very important that governments consider how rising transport costs are applying financial pressure to Australian households when formulating policy.”

Commissioned by the AAA and developed by SGS Economics & Planning, the Transport Affordability Index tracks transport affordability by analysing tax, tollways, public transport and finance costs as a proportion of average household income across states and territories.

The Index will be updated regularly by the AAA, and can be downloaded here.

 Summary of findings – Quarter 3, 2016:

  • Melbourne was the only capital city to experience a fall in average annual transport costs, down from $18,136.02 to $18,056.11.
  • The average family in Sydney is paying around $21,653 (up from $21,389.78 in Q2) while the annual cost of land transport is lowest in Hobart at $14,197 (up from $14,115.72 in Q2).
  • A typical two-car Sydney household faced weekly transport costs of $416 per week, ahead of Brisbane and Melbourne at $377 and $347 per week respectively.
  • In Perth and Canberra, weekly transport costs were $308 per week and $302 per week respectively.
  • Adelaide, Hobart and Darwin had relatively low transport costs, at $287, $273 and $288 per week respectively. In these cities, public transport, driver’s licences and vehicle registration were all relatively less expensive.
  • Car loans continue to make up the biggest share of a household’s transport costs.

The Index is based on the incomes and transport costs of a hypothetical household in each capital city that consists of a couple with children and two cars. It assumes that one member of the family drives to work, while the other catches public transport.

Hypothetical suburbs were also chosen as they were middle to outer ring suburbs, had a relatively high population density, had access to public transport, and in Sydney, Melbourne and Brisbane, would require driving through toll roads to access the CBD. The Index’s data baseline is quarter one (January to March) 2016. 

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