Carpool lane & Bridge toll dilemma

Don't know the $$/mi cost for the PIP, but by taking the 8mi longer route (I'm assuming you do it on the way to work and on the way back home) you're adding an additional 4000+ miles to your car every year.

 

still another two thousand miles…i generally will take a longer route only if it's faster.
keep in mind, you'll also burn an additional 40 gallons of gas going those extra 2k miles.

 

If you only consider the fuel costs...it would be about $0.56 of gas per 8 miles ($3.50/gal)...or $0.07/mile. Cheaper if you are using EV (but I doubt your extra 8 miles could be on EV).

Excluding insurance (you have to pay this, somewhat flat fee anyway) and maintenance, if you keep the car for 150K miles and it cost $32K-$2500 that is about $0.20 per mile. Of course the car will still have some value after 150K miles, but then you will incur other maintenance costs earlier or in addition. So, maybe $0.25 - $0.30 per mile or $2.00 - $2.40 per 8 mile trip.

However, I don't think this really answers the question you should have asked. The real question is what is the difference in total costs between driving (for example) 100K miles in 10 years vs 120K miles in 10 years. I would think that the additional 20K miles are much cheaper than the first 100K miles on a per mile basis, on average, assuming no catastrophic maintenance.

Mike

 

I did cost per mile analysis in figuring out how much I was paying per mile in electric based upon what tier I was at the moment with SCE. On electric you are paying a range of .02 to .07 per mile on electric. When gas was $4.50 a gallon and assuming you are getting 50 mpg, the cost is .09 per mile.

.50 per miles seems a bit expensive even for a hummer (12 miles per gallon = $.38 / mi)

 

2000 miles per year (extra fuel + maintenance + depreciation) vs. $625 in tolls. The answer will depend on how one assigns various costs as either fixed (calendar based) or variable (mileage based). Neglecting environmental impacts, I would lean slightly towards the non-toll route, but the answer is so close I can easily see others picking the opposite choice.

Once tires and oil and other maintenance and depreciation are included, you won't be able to operate a hummer for just $0.50/mile.

 

You might want to use an incremental model.


Incremental Analysis Definition | Investopedia

 

$0.50/mile is close to the IRS allowance for business use of a personal automobile. I do what I can within reason to avoid tolls. I'd rather get out of the traffic & avoid the toll.

 

Why would there be traffic around a toll?
Regardless, he's paying a carpool toll, which is charged with an open road tolling system at speeds of 65+ mph in a dedicated lane. OP also said travel times are similar between the two routes.

 

you can always flip a coin everyday.
tails = toll
heads = no toll

 

The IRS has three different rates for different uses:

As best I can figure, the lowest rate covers just the average fuel cost for the average car.

The middle rate also covers maintenance and possibly some other variable costs, but not fixed costs such as insurance and age-linked depreciation. It really represents an incremental cost for uses that rarely call for keeping a separate vehicle.

The top rate covers everything, including fixed costs amortized over typical miles driven. It is meant for uses where many entities commonly keep special vehicles separate from personal use vehicles.

My own measure for cost comparisons is similar to the middle rate, but includes full depreciation amortized by miles. I normally change cars based on wear-out, which is more linked to the odometer than to the calendar. (Last year's trade was an exception.) Owners who trade on a fixed calendar schedule rather than mileage should use a smaller depreciation term than I use.

In OPs case, I'd probably listen to traffic reports to decide if one route is likely quicker on any particular day. The car costs are sufficiently close that the value of time applied to the daily congestion variations could easily be the determining factor.

 

You're talking about taking 237 instead of the Dumbarton Bridge, right? Before my PiP, I almost always chose 237 because it would be less than the $5 toll but only barely. If my destination was south of where the bridge exits on the other side of the bay, I would take 237. North of that, I took the bridge.

With $2.50 toll, I'd probably choose the bridge. If cost and time are inconsequential, I'd choose the toll for the benefit of others. Shorter distance traveled is less pollution your PiP is putting out. Outside of rush hour when the toll is $5, then I go back to 237, traffic permitting.

 

One thing to consider is that some costs are sunk costs. Meaning if you garaged your PiP from day one, the costs would be the same as if you drove it 1,000 miles per day. The cost of the car is a sunk cost, as are registration and taxes. Some insurance policies adjust slightly based on mileage, but the difference is generally small so insurance is basically a sunk cost. The point being that your decision on the bridge vs. carpool lane will have no impact on those costs. That leaves maintenance, service, and fuel as the real variables.

Assuming fuel at $4/gallon, electricity at $0.12/kWh, maintenance at $0.04/mile ($200 each 5,000 miles), and tires at $0.015/mile ($600 each 40,000 miles), your per mile costs are probably around $0.14. If that is near correct your annual cost of avoiding the toll is around $280, which is a savings of $345. Looking at it another way, it's like having a second job earning $10.35/hour to travel the longer route. The downside is that your second job only schedules you for 33 hours a year.

 

I disagree about the cost of the car being a sunk cost. It is a depreciating asset. Because it can be sold recover some if its cost, that portion is not sunk.

How it gets depreciated varies from owner to owner.

 

I'd also disagree about the mileage having no effect on insurance. I have personally seen insurance rates (especially for high-risk drivers, i.e. unmarried males under 25) change significantly based on the number of miles driven.
btw, 237 has the express lanes, which are free for the pip (but you have to take off FasTrak every time you go through them). is the time equal between the routes if you take the express lanes?
i'd still go for the lower-mileage option.

 

I would use the values brought forward by the companies that lease out the PiP. They have done a fairly extensive analysis of what to expect for a resale value based on 10k, 12, and 15k per year over 24 month and 36 month terms. I think the numbers I gathered for a PiP this past summer came in around $0.20/mile on a 36 month term.