Blog: 27 April 2016 (Filling up all registered vehicle tanks)
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In today's blog we look to answer the following question. How much money does it take to fill up all the registered vehicles in South Africa? We will take a look at the number of different vehicle types registered, get an average fuel tank estimate of each vehicle type, and then use the current Rand petrol price to determine an estimated cost of filling up all the registered vehicles in South Africa.
Data source: Road Traffic Management Corporation |
In total there were 11 369 925 registered vehicles on South Africa's roads by end December 2015. Of which 4 million or 36% (is in coastal provinces, KwaZulu-Natal, Eastern Cape and Western Cape). Now that we have the number of registered vehicle by type, we can estimate the average size of each type's fuel tank, based on industry information, and then calculate the money spent per vehicle type based on the current 95 Octane price per liter of Petrol. For simplicity purposes we will assume all vehicles have petrol engines and use 95 Octane petrol.
The following tank sizes are assumed:
For the estimated value the number of liters being bought, the number of vehicles are multiplied by their estimated tank size. We will then calculate 36% of the estimate based on the coastal fuel prices, and the other 64% based on the inland fuel prices (due to the fact that 36% of vehicles are registered in coastal provinces)/
Based on the number of vehicles and the estimated fuel tank sizes of these vehicles, its estimated that it will take 563 968 070 liters of fuel to fill up all the registered vehicles in South Africa once. The total amount of Rand's spent to fill up these tanks (based on 36% of vehicles filling up using coastal fuel prices and the other 64%) just once, amounts to R6 911 541 491..
The following tank sizes are assumed:
- Motor Vehicles : 45l
- Mini Busses/Taxi's: 75l
- Buses: 250l
- Motorcycles: 20l
- LDV's and Bakkies :45l
- Trucks: 250l
- Other & Unknown: 50l
For the estimated value the number of liters being bought, the number of vehicles are multiplied by their estimated tank size. We will then calculate 36% of the estimate based on the coastal fuel prices, and the other 64% based on the inland fuel prices (due to the fact that 36% of vehicles are registered in coastal provinces)/
Based on the number of vehicles and the estimated fuel tank sizes of these vehicles, its estimated that it will take 563 968 070 liters of fuel to fill up all the registered vehicles in South Africa once. The total amount of Rand's spent to fill up these tanks (based on 36% of vehicles filling up using coastal fuel prices and the other 64%) just once, amounts to R6 911 541 491..
Assuming everyone fills up their tank once a month, that amounts to spending of R 82 938 497 898 a year (or 6 767 616 840 liters of fuel being purchased a year). That is roughly 2.1% of the total worth of South Africa's economy (calculated using current price GDP at market prices for 2015), that is spent on fuel (assuming a tank is filled up only once a month).
Assuming a tank is filled up once a week (which is more realistic than once a month), the spending on fuel per month amounts to R27 646 165 966 a month and a total value of R331 753 991 590 spent on fuel in a year (that 27 070 467 360 liters of fuel purchased a year). This equates to just over 8.3% of the total worth of South Africa's economy (calculated using current price GDP at market prices for 2015)
And with the recent 30c/l increase in the fuel levy announced in the 2016 budget, National Treasury is set to earn at least R2billion extra in additional revenues by just raising the fuel levy (assuming petrol tanks are filled up just once a month). If petrol tanks are filled up once a week, National Treasury is set to net over R8,1billion in additional revenues by raising the fuel levy.
By Treasury's own calculations they expect to net R6,8billion in additional revenues from the 30c/l increase in the fuel levy.