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What is the total cost of owning a car?

Running costs, insurance, servicing – the cost of owning a car is more than you think.

According to CarExpert, a cheap car is likely to set you back around $20,000. That makes it look like the cost of owning a car in 2024 is no sweat but there's a long list of other costs to think about.

Based on the latest Transport Affordability Index published by the Australian Automobile Association (AAA), the average cost of owning a car in Australia as of September Quarter 2023 is $24,262 per year for capital cities and $20,404 per year for regional areas.

Costs are up by approximately 4% this period compared to the previous quarter. The increase was largely driven by increasing fuel prices and cost of car insurance. The steepest spikes were experienced at $1,171 in Melbourne for capital cities, and $864 in Lauceston for regional areas.

Are you planning to buy a new car soon? Finder's Consumer Sentiment Tracker recorded 21% of respondents (n=1,059) will be shopping for a new ride this year.

The total cost of owning a car

To get the total cost of buying a car, you should factor in both the drive-away cost and car running costs. You should also consider depreciation costs.

The AAA estimates that the weekly upfront cost of owning a car is $$263.22 if you live in a capital city, and slightly lower at $254.05 if you're in a regional area.

The average car price in Australia for a brand-new vehicle is $61,949. This is based on the average car price of the top 5 selling motor vehicles in February 2024 released by the Federal Chamber of Automotive Industries.

Vehicle type and model

Prices can vary a lot depending on the car make and the model you buy. For example, a Ford Ranger, the most popular vehicle in Australia, comes at an entry-level price of $50,146 while the Tesla Model 3 comes at an entry-level price of $58,900. If you opt for add-ons on the interior or exterior, be ready to shed off a couple more of your cold hard cash too.

In the past, buying a used car may have seemed like the cheaper choice but that may not always be the case, depending on what options you're willing to consider.

Manufacturers are closing the gap in the demand for new cars as supply chain issues met in the past two years continue to be resolved. As car production ramps up, the average price for brand new cars are expected to drop, more buyers are expected to choose brand new cars, and prices for used cars will slide. Used car prices already experienced a steep 12% decline in January and are further expected to drop by 10% later this year.


This next parameter will not matter much if you're cashing in on a brand-new vehicle. However, it greatly affects price, performance and future maintenance costs if you're opting for a used car.

Lower mileage could jack up the price. It could also possibly lower car service costs compared to a used car with higher mileage.

Financing costs and interest

Where and when you take out a car loan affects how much you pay for how long. If you research your financing options well enough, you should be able to better negotiate financing terms.

Taxes and registration

The actual drive-away cost will always be significantly higher than the advertised car prices. Where you buy also impacts how much you pay for registration. For instance, stamp duty on cars in NSW would cost more than stamp duty on cars in QLD.

You'll also be required to pay for Compulsory Third Party (CTP) insurance to have your vehicle registered and ready for the road. Research ahead and compare car insurance to get the best deals.

Finder survey: Why don't Australians have comprehensive cover?

It's too expensive45.83%
My car is not worth much18.75%
I don't know what comprehensive cover is10.42%
Source: Finder survey by Pure Profile of 1006 Australians, December 2023

Recurring costs of owning a car

When you're planning to buy a new car, you need to remember that the true cost of owning a car goes far beyond driving it out of the dealership.

Overall, the AAA estimates that transportation costs account for 16.9% and 15.7% of a typical Australian household's income in the capital cities and regional areas, respectively. The report also emphasises that lower cost estimates do not necessarily mean it's more affordable, especially since household income is significantly lower in the regions than in capital cities.

Here are some of the additional costs you should consider.

Petrol costs

Petrol prices have been hitting new peaks since the pandemic and continue to worsen. With the reintroduction of fuel excise taxes, refills will cost $15 more for every 60 litres.

Maintenance and repairs

In April, a Finder survey of 919 Aussies found that 2 in 5 skip on vehicle upkeep, while 1 in 4 admitted not being able to afford car service costs.

The more you drive, the higher the cost of maintenance. Can your current budget and living costs absorb this additional cost?

Car insurance

CTP is required for registration but if you want cover for damage to your own car, you'll need comprehensive car insurance. According to the 2023 Finder Car Insurance Awards, the average cost of comprehensive car insurance was approximately $1,366 per year.


Find out the resale value of the car you're planning to buy. Use websites like CarSales to see how various cars and models hold their value over time based on conditions and kilometers travelled among other factors. In general, some brands will depreciate faster than others.

Parking and toll fees

Account for toll and parking fees on your usual route. If you don't have a garage at home, you may have to rent parking space continuously.

Tips to save on the costs of owning a car

It's clear. Vehicle price is not the only car cost you should be thinking about if you're planning on buying a car.

Here are some ways to save on your next car purchase.

Buy secondhand

Keep in mind that a brand-new car may carry a steeper upfront cost but a secondhand car, depending on its condition, may entail higher running costs.

Buy an energy-efficient car

The upfront cost of buying an electric vehicle (EV) is steeper. However, car running costs may be significantly reduced over time.

The good news is that different states are pushing for wider EV ownership, and have come up with incentives for EV buyers. If owning an EV is an option for you, make sure to check out EV incentives where you live and take note of any conditions like price threshold as well.

Avoid unnecessary add ons

Always demand a cost breakdown. Keep an eye out for unnecessary add-ons so you can keep costs to a minimum.

Follow the car maintenance schedule

Don't skip out on your maintenance schedule. If you can't afford car maintenance and repairs, maybe you really can't afford the total cost of owning a car. If you miss periodic checks, you're only setting up yourself for more serious car trouble ahead.

Keep your car insured

Like any other insurance, the last thing you want is to file for an insurance claim. However, buying sensible car insurance coverage shields you from surprise expenses.

Drive safely

Learn energy-efficient driving techniques to save on energy costs and decrease the rate of wear and tear of your motor vehicle's engine and parts.

Can you afford a car in 2024?

Don't be duped by a car's advertised price. Shop around and always inquire about the drive-away cost of owning a car. Always think about what other options you have.

Set a budget for your next car purchase and work through car running costs into your regular budget. That new ride will definitely cost you extra and it pays for you to know how much you can really afford to spend on buying and running a car month after month.

Frequently asked questions

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