Cindy Temple drives a big, four-wheel drive.

With the price of petrol at all-time highs — even with the recent cut to the fuel excise — filling up her 15-year-old Toyota Prado is painful.

“It’s a 150-litre tank,” she said.

“The last time I filled up, it wasn’t quite empty, and it cost me $350.”

She knows what you’re all thinking: downsize.

But, of course, it’s not that simple.

Ms Temple has seven kids and one grandchild, and her vehicle has rear seats that allow her to cater for her big family.

“I’d probably like to downsize perhaps to a smaller car,” she said.

That’s because, along with fuel, new and second-hand vehicle prices are also at record highs.

Disruptions to global supply chains during the pandemic have led to major vehicle manufacturers slowing production, making it difficult for new car retailers to replace their stock.

“It’s very hard to get a new vehicle,” said Garry Bailey from the Royal Automotive Club of Tasmania.

“So, what we’re seeing is the price of used cars is absolutely rocketing, because people are desperate to get a good car.”

According to Australian market researcher Datium Insights, the average price of used cars has gone up 50 per cent since the start of the pandemic.

That means people are holding on to the car they have.

According to the Australian Bureau of Statistics’ 2021 Motor Vehicle Census, the estimated average age of passenger vehicles in Australia has increased from 9.8 years in 2016, to 10.4 in 2021.

Canberrans drive the newest cars, with an estimated average age of 9.4 years.

Tasmanians drive the oldest, with an average age of 12.9 years.

A graph shows the average age of vehicles in each state.
This graph shows the average age of vehicles in each state.(ABC News: Paul Strk)

“That has a hit on the family budget,” Mr Bailey said.

“If you have an older vehicle, it’s probably less fuel-efficient, and you’re probably spending more on maintenance.

“The older your vehicle, the more likely you are to break down.”

Cindy Temple says it cost her $350 recently to put fuel in her car.(ABC News: Luke Bowden)

Where are the most fuel-efficient cars?

So what makes it so difficult for Tasmanians, in particular, to replace their old cars?

It could all come down to economics, and the cycle of disadvantage.

According to the most recent ABS figures, Tasmanians earn less than their mainland compatriots, with a median personal income of $47,352.

And who earns the most? It’s those living in the nation’s capital.

Despite their old age, Tasmanian vehicles aren’t actually the least fuel-efficient.

It’s Queenslanders’ cars that consume, on average, 11.6 litres of fuel per 100 kilometres.

At $1.91, Tasmanian petrol is the second-most expensive, behind the $2.12 you’ll pay in the Northern Territory.

While filling up in Victoria is the cheapest in the country, with an average pump price of $1.78.

When you combine fuel cost and efficiency, the Northern Territory is also the most-expensive place to drive 100 kilometres, while Victoria is the cheapest.

A graph shows how much it costs in various states to drive 100 kilometres.
A graph shows how much it costs in various states to drive 100 kilometres.(ABC News: Paul Strk)

People taking ‘necessary’ trips only

According to the Australian Automobile Association’s Transport Affordability Index, Hobart is the cheapest capital in the country when it comes to the overall cost of transport, when loan repayments, insurance, registration, servicing, tolls, public transport and roadside assistance are factored in.

The average Hobartian spends around $350.14 per week on getting around, whereas a Sydneysider spends more than $477.

However, because Tasmanians earn so much less, they actually spend more of their income on transport than anyone else.

It means Tasmanians such as Ms Temple are stuck in a vicious cycle.

They can’t afford to upgrade their cars, which means they spend more to keep them running, which means they have less or no money to upgrade.

Far from having the money to save for a new car, Ms Temple cannot afford to get to her appointments.

“Unless it’s necessary, I just don’t go. I had a doctor’s appointment in Glenorchy, which I cancelled, because I couldn’t justify the fuel to go there and back,” she said.

“It’s just bare necessities now.”

However, just because you cannot afford them, does not stop the bills from rolling in.

Ms Temple just paid her rego for six months, and her vehicle now needs new tyres.

“That’s probably going to be around $1,000, so I’ll be trying to wait until tax time for that one,” she said.

Cindy Temple says she can’t afford to go on any holidays.(ABC News: Luke Bowden)

People taking out loans to repair cars

Without any disposable income or savings to draw on, people are turning to loans to keep those old cars on the road.

John Hooper works for the No Interest Loan Scheme (NILS) in Tasmania, which offers small, interest- and fee-free loans to people on low incomes.

“Every fortnight, we’re saying, ‘What are the trends we’re seeing?’ and car repairs, car repairs, car repairs are coming up,” he said, “14-17 per cent of our loans are going to car maintenance. Another 11-12 per cent are to pay registration.”

John Hooper says the loans issued by NILS in the past 12 months are up 25 per cent on the previous year.(ABC News: Luke Bowden)

NILS says that going into debt to fix your car is not ideal, but the alternative is worse.

“We had a client comment in a survey the other day that it was the first time they’d ever had new tyres on their car,” Mr Hooper said.

The number of loans issued by NILS in the past 12 months is up 25 per cent on the previous year.

To service those loans, the state and federal governments have increased their financial support for the organisation.

“People might say that’s encouraging debt,” Mr Hooper said.

“That’s a very middle-class perspective on the way people are having to live to survive.”

Their loans also prevent people from turning to higher-interest loans, or what Mr Hooper describes as “predatory lenders”.

“We’re really concerned about the levels of AfterPay we’re seeing in bank statements, the levels of what we call payday lenders, where people are doing cash loans to pay bills,” he said.

“That puts people into a debt spiral.”

Tasmanian petrol is the second-most expensive, behind the Northern Territory.(ABC News: Luke Bowden)Extracted in full from: People are taking out loans to keep their cars on the road as cost of fuel and vehicles increase – ABC News