What's the Price of Being a Car Owner in Malaysia?
So you’ve saved up a decent amount of money since you first began working, and you feel like you’re now ready to take on the next big thing in life: becoming a legitimate car owner in Malaysia!
Get to know the real car ownership costs in Malaysia
Before you start revving the engines of this personal project, though, you may want to think twice – if not thrice. Owning a brand-new car certainly makes travelling about in Malaysia a much easier affair, but it is also a massive financial commitment to car-ry, especially for the first five years from the time of the car's purchase.
Loan and Interest Payments
Being able to afford a car in Malaysia means being able to cover various forms of payments – and one of the biggest payments to be made regularly when owning a car would be loan and interest payments.
To demonstrate how much these payments would cost at a basic level for a car that is made in Malaysia, we’ll be using the 1.3L G - Manual version of the brand new Perodua Myvi 2018, which has a price tag of RM44,300, as an example.
Image credit: Perodua
Assuming a loan of 90% of the purchase price is taken for the car, with repayment set to take place across a period of five years at an interest rate of 3.1%, you will be looking at a monthly payment of RM767.50 to the bank from which you received the loan. That also amounts to a total interest and loan payment of RM9,210 per year, and RM46,050 after the five years of repayment.
You could opt to reduce the monthly payment by increasing the period of repayment to seven or nine years, but the total interest paid at the end of these periods will be substantially higher.
Car road tax
Naturally, all car owners in Malaysia are required to pay road tax charges for their vehicles, and these charges are payable on a yearly basis as you are required to renew your road tax every year.
For the 1.3L G - Manual version of the Perodua Myvi 2018, the road tax rate will clock in at a rate of RM70 a year, as the car’s engine has a total displacement capacity of 1329cc.
However, it is useful to remember that the rate of a road tax charge commonly increases with the total displacement capacity of a vehicle’s engine, which is why bigger cars tend to warrant higher road tax rates.
Car insurance premium rates depend on a variety of factors, especially since the liberalisation of motor insurance in Malaysia earlier this year, which allows individual insurance providers to determine their own premiums based on elements like risk factors.
For starters, the type of plan that you opt to take up would be a vital point of consideration, as different insurance plans may have different degrees of coverage and unique selling points, and thus different premium rates. Here’s a fun fact: GoBear will be able to help you greatly in this area very soon, with our upcoming car insurance comparison tool!
Upon selecting a plan, the insurance provider would then require various pieces of information from you. Citibank’s SmartDrive insurance scheme, for instance, considers your vehicle’s year-of-manufacture, engine capacity and the sum that you would like to insure before quoting your premium rate.
It should be noted, though, that insurance premium rates decrease over time as a vehicle depreciates and after deducting the no-claim discount (NCD) where applicable.
Hence, it is a good bet to put aside RM1,200 a year for insurance premium payments, and around RM6,000 for a total of five years when it comes to the 1.3L G - Manual version of the Perodua Myvi 2018.
Unless you’re driving a fully electric car, you’ll find that in your time as a car owner, a large part of your expenditure will go to petrol stations and your car’s fuel consumption.
Different cars consume fuel or petrol at different rates, and buying a car which consumes fuel efficiently is generally recommended for first-time car owners. In the case of the 1.3L G - Manual version of the Perodua Myvi 2018, five litres of fuel will spare you 102.5km of travels.
If you own this particular car and happen to travel roughly 1,025km a month, your car will be running on 50 litres of fuel each month. Assuming the current petrol price of RM2.30 (RON95) per litre holds for the next five years, that’s a total payment of RM115 per month, RM1,380 a year, and RM6,900 for the entire five-year period.
Maintenance encompasses the cost of servicing your car, which you will be encouraged to undertake on a regular basis by your car seller. Servicing is usually performed when your car achieves a certain amount of mileage, and has been the subject of considerable wear-and-tear in the process.
According to the charges as explained on Perodua’s website, if you drive a total of 60,000km across five years in your Myvi, you will be forking out up to RM2,000 for maintenance and servicing charges in that period.
Keep in mind, however, that this does not include other maintenance charges – like brake pad replacements, tyre changes and battery corrections. If you factor in the prices of these, the total payment for maintenance charges over five years would increase exponentially.
Unless you have a bone to pick with the law or are deliberately looking to stir-up some trouble with the traffic police, it is good practice to make sure that you’re always driving with a valid driver’s license.
In Malaysia, the renewal rate for a driving license is fixed at RM30 per year, regardless of the kind of car that you own or will be purchasing. Renewing your license for a period of five years will set you back by RM150, as such.
This renewal can be done through various means – including through online portals and at the post office.
Optional amenities - what other costs?
You’re also allowed to equip your car with extra or additional features; features that may not be a part of your desired car by default when you first buy it.
A good illustration of this would be tinting. If you’re planning to get your car’s windows tinted, to help with both visibility and protecting its glass surfaces, you would need to set aside some money for this too. This would be a one-off payment, though, and you will not need to worry about making repeated payments across the years.
While tinting rates tend to differ from one shop to another, it is a good idea to keep aside RM1,000 for the tinting of the 1.3L G - Manual version of the Perodua Myvi 2018. If there’s any money left once this payment is completed, you can always channel those funds to a different part of your car ownership budget.
It is better to be safe than sorry, after all!
Summing It All Up
When you put it all together, the first five years of owning a stylish, brand new 1.3L G - Manual version of the Perodua Myvi 2018 will need you to have:
|Loan and Interest Payments||RM 46,050|
|Road Tax||RM 350|
|Basic Maintenance||RM 2,000|
|License Renewal||RM 150|
|Optional (Tinting)||RM 1,000|
That’s right! You would need RM62,450 to fulfill all necessary payments across those five years. This is exclusive of other possible additional charges as well, like parking, tolls, traffic summons, and car decorations or modifications.
With this is mind, are you prepared to shift your gears, release your brakes and move ahead with your car ownership plan?
If you are, do remember that owning a car is very much like being in a relationship. It’s a responsibly, a commitment, a serious affair – and a life-changing experience!