The upside of high $

May 2, 2013

Petrol prices fell 12 cents during April and could drop below $2 a litre according to the Automobile Association.

The price of 91 octane petrol fell to $2.05 per litre in the main centres, while diesel fell 10 cents per litre to $1.42 a litre at most service stations, the lowest price since July 2012.
 
“Since mid-March, petrol prices have fallen 16 cents per litre, and diesel 13 cents. In all, fuel prices have fallen on seven consecutive occasions, the most number of sustained drops since June 2012,” says AA PetrolWatch spokesperson Mark Stockdale.
 
“However, the AA’s monitoring of commodity prices shows that since the last retail price increase in mid-February, the imported cost of petrol has fallen nearly 19 cents per litre, and diesel 16 cents. That means fuel companies have not passed all of the lower costs onto motorists, although some service stations have discounted prices below $2 a litre.”
 
This time last year we were paying $2.20 a litre for 91 petrol and $1.57 a litre for diesel, meaning motorists buying 40 litres of petrol today will be saving about $6 a time, or about $158 a year for a typical 2-litre car.
 
“International fuel prices have been consistently falling due to lower global demand, and increased supply as refinery production comes back after shutting down for maintenance,” Mr Stockdale said.
 
“Although in the last few days oil prices have risen slightly, at current trends there is a good chance the price of 91 octane petrol will fall below $2 a litre soon, the first time since June and July last year,” Mr Stockdale added.

The value of our dollar also plays a role in the price of fuel.

The upside of the higher exchange rate which makes export prices more expensive is that it makes imports cheaper.

LabourGreen say they’ll bring the value of the dollar down.

Bigger economies than ours have tried to do that with no success and at a very high cost.

If they did succeed it would immediately devalue everyone’s purchasing power as the cost of essential imports, including fuel, would rise.


Fewer WoFs, safer cars?

October 17, 2012

When the flashing lights came on behind me I knew I hadn’t been speeding but there was no other car in sight so I pulled over.

The police officer stopped behind me, came up to the window and said only one of my rear lights was working.

I told him I’d only just got a warrant of fitness.

He replied, that meant the car was fine on the day, it didn’t mean it would stay that way.

I’ve been thinking about in light of the conversation about proposed changes to Warrants of Fitness regulations.

The Motor Trade Association is urging caution:

With WoF and CoF inspections acting as a trigger for vehicle maintenance for many owners, it plays a key role in maintaining the state of our fleet at a very basic level. MTA will be providing a strong submission to Government to retain current inspection frequencies, but believes the inspection process can be improved to take into account the many new safety technologies in today’s vehicles.

There should be no changes to the current system unless there is a stronger commitment to education on maintaining vehicles and significantly more police enforcement. While that might be achievable in the longer term, it is likely to result in a transfer of costs from motorists to government thereby defeating the very aims the reforms set out to achieve.
Stronach says “While you might save $45 a year and perhaps 40 minutes out of your day, there may well be increases in other costs, including higher insurance premiums. We think all motorists want to have confidence that every vehicle on the road is safe, not just theirs, regular and comprehensive inspections are a good value for money way to achieve this.”

The Automobile Association thinks the changes could improve road safety:

“Some of the opponents of change to the WoF system seem to be cherry-picking information and not mentioning the time and cost benefits for motorists from a revised testing scheme nor the changes we can make to improve vehicle safety,” says AA spokesperson Mark Stockdale.

As part of the AA’s analysis of the changes being proposed, we looked at the data on every fatal crash in New Zealand over five years from 2007-2011. We did this to understand the possible safety impacts of any changes.

The crash data showed that out of 1640 crashes, there were 89 (or 5.4%) where a vehicle fault or factor was found that may have contributed to the crash.

Of the vehicles in those 89 crashes, 39% did not have a current WoF and 52% had a tyre fault.

Analysis of overall NZ road crashes indicates that vehicle faults contribute to about 2.5% of all fatal and injury crashes and to 0.4% where the fault is the sole cause of the crash.

To put that in some context, the most common factors contributing to fatal crashes are alcohol or drugs (36%), a driver losing control (34%) and going too fast for the conditions (32%).

“Vehicle faults do play a part in a small number of road crashes but it’s misleading to simply claim that changing the WoF frequency will lead to that number increasing,” says Mr Stockdale.

“Nearly 40% of the vehicles with faults that were involved in fatal crashes didn’t have a WoF anyway, so how frequently they are supposed to be getting one is not the issue.

“Worn tyres are another key factor in crashes but there are other ways to target this than solely through a WoF.

“Rather than having a regime that is testing the majority of motorists excessively we need to focus more on enforcement to get vehicles without WoFs off the road and investigate ways to better monitor tyre condition.”

Less regular checks would put more responsibility on drivers to check tyres and keep up with other maintenance that we ought to do anyway.

That could make vehicles safer because as I found out getting a warrant doesn’t mean everything keeps working as it ought until the next one.

The AA has more information on the issue on its website.


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