Lance Thoo
(Photos: Shutterstock)
Which is better? Booking Grab rides for a year or using your own car?
In all honestly, this is a subjective question since the word “better” can mean different things to different people.
The Southeast Asian ride-hailing service, which was founded in 2012, had clocked in as many as 2 BILLION rides as of July 7, 2018.
Today, Grab is present in 8 countries across the region including Singapore, Malaysia, Indonesia, Thailand, Vietnam, Philippines, Myanmar and Cambodia.
Clearly, there is demand for private-hire car services.
Let’s first take a look at the best selling new cars across the Association of Southeast Asian Nations (ASEAN) last year.
According to a 2017 report, used cars made up the largest sector in the car markets of Myanmar, and Cambodia. Thailand ranked number 12 among the world’s top motor vehicle producers. Indonesia was the largest car market in Southeast Asia. Region-wide, Toyota reigned supreme as the bestseller except in Malaysia, which was happy to stick with homegrown brands.
‘Most Expensive Place In The World To Buy A Car’
Singapore remains the most expensive place in the world to buy and run a car, the Economist Intelligence Unit (EIU) said in its report.
The country has successfully avoided Asia’s massive traffic jams by controlling vehicle ownership through a quota system under which a buyer must pay for a Certificate of Entitlement – currently nearly 40,000 Singapore Dollars (SGD) – on top of the vehicle’s actual price. In other words, a basic sedan comes with a 100,000 SGD price tag.
Let’s now make some ‘cents’ (sense) of car ownership in Singapore.
The infographic above illustrates how much it really costs to own and operate an entry-level car in the city-state.
Using Grab Cheaper Than Owning A Car?
According to a report released by consumer research firm Value Penguin, using Grab would be cheaper!
To carry out the investigation, the firm had to make the following assumptions:
(1) The average car is driven 17,500km annually (or 4 trips of 12km per day).
(2) The average car is a Toyota Corolla Altis, which gets 6.5l/100km economy.
| Main Costs of Car Ownership In Singapore | Average Annual Cost |
|---|---|
| Purchase Price | 105,000 SGD/10 years = 10,500 SGD per year |
| Annual Insurance Premium | 909.50 SGD |
| Maintenance Cost | 621 SGD |
| Road Tax (1,600 cc engine) | 742 SGD |
| Petrol ($2.06 SGD/litre) | 2,341 SGD |
| Total | 15,113.50 SGD |
For Grab in Singapore, the following assumptions were made:
(1) The same daily travel of four trips of 12km.
(2) The average speed travelled of 50km/h.
| Annual Cost of Ride Sharing Service In Singapore | Grab |
|---|---|
| Number of Trips | 1,460 SGD |
| Base Fare | 3,650 SGD (2.50 SGD/ride) |
| Distance Based Cost (17,500km) | 8,750 SGD (0.50 SGD/km) |
| Time Based Cost (21,000 minutes) | 3,360 SGD (0.16 SGD/min) |
| Total | 15,760 SGD (or 1,313 SGD/month) |
Judging from the two tables above, it would seem that owning your own car is CHEAPER than just Grab-ing everywhere.
According to Budget Direct, what looks like a conclusive victory for having your own car does change a bit when other costs – such as parking and car washes – are factored in.
That said, driving more distance in a year tips the scales back in car owners’ favour.
Does It Make Sense To Grab Everywhere?
Well, it depends on how you choose to look at it.
One Grab user from Singapore that Neue spoke to commented: “The best part about catching a Grab ride rather than driving myself to work is that I don’t have to pay for fuel or parking fees. Another bonus: I just love the fact that I get to nap during rush hour!”
Another person said, “From time to time, Grab would give out promo codes and discounts. Riding with Grab also allows me to accumulate reward points which can be exchange for even further discounts!”
We’d Love To Hear From You!
Are you willing to say goodbye to your car and just resorting to ride-sharing services like Grab? What are your thoughts about these services? Are they hurting the livelihood of taxi drivers? Or are they a godsend for tourists?
Share your thoughts in the comments section below or reach out to Neue on Instagram or Facebook.