The latest AAA Transport Affordability Index shows that over the course of 2023 typical Australian household transport costs rose by 13 per cent, far outpacing the year’s Consumer Price Index increase of 4.1 per cent.
The report, released by Australia’s peak motoring body, shows that in 2023 transport expenditure rose by 12.4 per cent for the typical capital city household and 13.7 per cent for the typical regional household.
Transport cost rises eased towards the end of the year. In the December 2023 quarter, the typical Australian household’s transport costs rose by 0.7 per cent (0.6 per cent for the typical capital city household and 0.8 per cent for the typical regional household). This was roughly in line with the quarter’s Consumer Price Index increase of 0.6 per cent.
But larger increases earlier in the year meant that transport affordability declined substantially in 2023.
In the December 2022 quarter, the typical capital city household spent 15.6 per cent of its income on transport, but a year later this had risen to 17.0 per cent. Over the same period, the typical regional benchmark centre household’s transport expenditure rose from 14.4 per cent of its income to 15.8 per cent.
The overall rise in transport costs was largely driven by higher up-front costs for purchasing new vehicles, higher interest rates on car loans, and increasing insurance premiums.
“The continuing decline of transport affordability is a heavy burden at a time when Australians are feeling cost-of-living pressures across the board,” AAA Managing Director Michael Bradley said.
“Transport is a significant and unavoidable expense for households and is also one of the key drivers of general inflation. Governments at all levels must consider these cost pressures when formulating policy.”
