The salary you need to earn to afford Honda’s new SUV in South Africa

You will need to earn at least R50,000 per month to afford the new Honda CR-V on a finance plan in South Africa, provided you are willing to pay a 50% deposit.

Honda recently launched the new CR-V e.HEV in South Africa which, at a starting price of R949,900, is R91,400 cheaper than the outgoing model.

It has a hybrid powertrain that includes a 2.0-litre petrol engine and two electric motors. However, unlike most hybrids, the engine and motors are not combined with a planetary gear system.

The engine produces 106kW and 189Nm on its own, while the e-motors develop 135kW and 335Nm.

The drivetrain is comprised of five main components: a traction motor, a generator motor, the engine, a lock-up clutch, and a power control unit.

“Because the wheels are driven by either the electric motor or a direct engine connection, the e:CVT has no conventional multi-speed gearbox, belts or pulleys,” said the Japanese automaker.

It has three driving modes – EV Drive, Hybrid Drive, and Engine Drive – which use the e-motors, engine, or a combination of both to suit the situation at hand.

Features on the flagship SUV include RS styling with gloss-black bumpers and a dual exhaust, a panoramic sunroof, leather upholstery with red stitching, white ambient lighting, a wireless charger, a 9-inch infotainment screen with smartphone pairing, a 10.2-inch TFT instrument cluster, and a head-up display.

It also has a driver-assistance suite that includes a LaneWatch camera, Adaptive Cruise Control, Lane Keeping Assist, Road Departure Mitigation, and Collision Mitigation Braking System.

Each purchase comes with a 5-year/200,000km warranty, a 5-year/90,000km service plan, 3-year roadside assistance, and an 8-year/200,000km hybrid battery warranty.

What you need to earn

We can use the following formula to work out the monthly payments on the new Honda:

• Car price – R949,900
• Payment term – 60 months (5 years)
• Interest – 10.75%
• Deposit – 0%
• Balloon – No balloon payment
• Extras – No optional extras

According to this, you’ll need to pay at least R20,630 per month for the new CR-V.

Financial experts then recommend that you do not spend more than 20% of your gross monthly salary on vehicle payments.

This means you’ll need a combined household income of R103,150 per month to afford the new SUV on a finance plan, assuming you don’t pay a deposit.

However, a 50% deposit of R475,000 reduces the instalments to R10,361 per month, meaning a more feasible salary would be R51,805 per month, provided you’ve saved up enough for the deposit.

Note that this figure does not account for insurance, fuel, and maintenance, which must all be factored into your budget.