The consumer price index rose 8.1% in June in the country. This is the sharpest increase in the cost of living since January 1983. For car costs, the picture is even less encouraging.
“This is a tough test for consumers who have to pay much more for a vehicle and for fuel,” summarizes George Iny, Managing Director of the Association for the Protection of Motorists (APA).
While Quebec inflation hit 8.0% last month, Treasury Secretary Eric Girard noted that “Quebec inflation is high […] and understands that rising prices are affecting Quebecers in their daily lives. »
The big culprit is fuel
This extraordinary increase is largely due to the increase in the cost of gasoline. In June, Canada had to pay 54.6% more for fuel compared to a year earlier, making the car bill much saltier.
In addition to petrol, a used car costs more than a new car. Inflation when purchasing a vehicle was 8.2% in June, a price effect “that we never thought possible,” comments Mr. Iny.
The director of the APA hopes that used car prices will fall again next winter, but warns that “strong price increases can be expected for new cars in 2023”.
Maintenance and repairs have also risen sharply: 6.1%. A trend that could prove to be sustainable.
“Maintenance will increase because there is a major shortage of qualified personnel, explains George Iny, and there is a very serious shortage of auto parts.”
Despite significantly higher costs, the APA boss observed a “certain inconsistency” in the vehicles bought by Quebecers.
With gas prices rising, “you’d think people would turn to smaller cars, but right now that doesn’t seem to be the case.”
Carpooling as a solution to reduce the bill
Other construction workers carpool and work overtime to cope with rising car costs.
“We work in construction, we drive from site to site, we take our car every day. So the cost of petrol means that we have less in our pockets,” answers Léo Beauchemin, a carpenter, when asked about the rise in petrol prices.
The worker sits in his car with his two colleagues during a break at a gas station on Montreal’s south coast. They have chosen to carpool to save on the cost of their car journeys.
Also limit wear and tear
“With inflation, we carpool more,” Léo explains. We don’t live in the same place, but we make it. We park halfway and drive together to save on fuel costs and the life of the car, because the vehicle wears out too. »
Are you planning to buy a new car given the current prices? This time it’s Pascal Gauthier, sitting to Léo’s right, who begins: “I ordered a pick-up”. It’s a fuel-intensive vehicle, but the cement maker believes it needs it for hunting. Like many others, he is still waiting for his new self. And if it doesn’t go into production very soon, the bill will go up.
“Rendered in August, I go to the prices of 2023,” explains the construction worker. That’s a $5,000 raise I think. You cannot guarantee the order price. Despite this, he’s still smiling. To compensate for the increases, he and his colleagues will “do moreover time “.
More 61.9% for gasoline
The increase in gasoline prices in Quebec in June was significant, to say the least: 61.9%. Yesterday the price at the pump in Montreal was $1.91. There was a slight drop in July as prices topped $2 a liter in June.
New or used, it’s more expensive
Inflation for the purchase of vehicles in the country exceeds 8% over a year. The culprits are the effects of the pandemic, the shortage of semiconductor chips and the increase in the cost of production facilities.
On the used market The newspaper reported a price increase of 25% last May. The upward trend continues: up 1.5% from May to June according to Statistics Canada.
New home prices follow the same curve: up 1.6% from May to June.
Struggling for mechanics drives up maintenance costs
With 6.1% inflation already on the rise in June, we expect prices for auto parts, maintenance and repairs to continue to rise.
According to George Iny, director of the Association for the Protection of Motorists, the hourly rate for a mechanic at a dealership is currently “$125 and up,” a rate that’s expected to continue rising as young skilled mechanics are short-lived. the calling.
“It’s a real struggle to get mechanics,” he says Alain Blondeau (photo), owner of the Sonic garage in Saint-Lambert. The contractor is sometimes required to offer $8 to $10 more to recruit workers. He states that he has had to increase his prices: +30% for tyres, +20% for filters and oil and a price increase of 10-20% for changing brakes.
The end of the grace period for insurance?
After a significant increase in auto insurance premiums since 2015, the decline in claims frequency during the pandemic is causing prices to stabilize in 2022. The latest data from the Groupement des Assurances Automobiles shows an average premium of $775 in 2021. However, the case continues : Insurance costs could soon rise to follow increases in repairing damaged vehicles.