Car ownership vs car sharing vs car subscription

Need access to a car? Compare options to find out which works best for your situation.

Having access to a car is a necessity for most people, but the rise of car sharing and car subscription services means you now have legitimate alternatives to traditional car ownership.

Each option comes with a number of benefits and drawbacks, and may be more or less suitable depending on your needs and lifestyle. While car ownership may suit those who need constant and long-term access to a car, car sharing and car subscription models may suit those wanting a bit more flexibility in how they use a car.

Find out how each model works, how they differ and which one may be right for you below.

How do they work?

Car ownership

Car ownership involves you purchasing a vehicle outright, either using your own savings or by getting a car loan to cover the purchase cost of the car. The car is considered your personal asset and you're free to use it as you wish. You can also sell the car at any time, as long as you've paid off your car loan (if you used the vehicle as security against the loan).

Considering whether to buy or lease a car? Compare them now

Car sharing

Car sharing is a form of car rental that lets customers use a vehicle on a short-term basis, whether that's for a couple of hours, days or weeks. The cars are either owned by companies such as GoGet – which charges customers a monthly or yearly membership fee as well as an hourly or daily rate every time they use a vehicle – or individual owners who want to rent out their vehicles when they don't need them through companies such as Car Next Door and DriveMyCar. In this case, users only pay for the period of time they need the car.

Car subscription

A car subscription service is similar to car sharing, but gives you ongoing access to a vehicle in return for a regular payment. You can generally choose from a range of brands and vehicle types, and may be able to switch vehicles as you wish. Most car subscription services have no fixed contracts and you can cancel your subscription when you want.

You will generally make a single weekly or monthly payment, which covers all registration, insurance and maintenance. There are a number of car subscription services in Australia, including Carly and Carbar.

What are the benefits and drawbacks?

Car ownership

  • Ongoing access to vehicle. As the owner, you have complete use of the car whenever you need it.
  • Greater choice of vehicle. You can choose the vehicle that suits your needs and aren't limited to the vehicles available on a sharing or subscription service.
  • The car is your asset. You can sell the car whenever you wish and use the funds for something else.
  • Depreciating value. Cars are generally a depreciating asset and lose value over time. If you plan on selling your car, you may find that you receive less than what you originally paid for it.
  • Limited to one type of vehicle. Unless you also purchase another car, or use a car sharing or subscription service as well, you will be limited to the type of vehicle you choose to buy.
  • Repair and maintenance costs. As you own the car, you're responsible for all ongoing repairs, which can be expensive. You also need to cover the costs of registration and insurance.
  • Cost of finance. If you need to get a car loan to cover the purchase of the vehicle, you will also need to cover the cost of repaying the loan.

Car sharing

  • Only pay for a car when you need it. You have the flexibility to choose when and for how long you rent the car.
  • Range of vehicles to choose from. Most car sharing services have a range of vehicles available, meaning you can choose the type of vehicle you need for different occasions.
  • Not responsible for repairs and maintenance. You don't need to organise repairs or servicing and simply return the vehicle once you've finished with it.
  • Choice of vehicles may be limited. You may find that the type of vehicle you require isn't available when you need it.
  • Vehicle pick-up. You will generally need to pick up and drop off the vehicle from a designated area, which may be inconvenient or prohibitive depending on your location.

Car subscription

  • Ongoing access to a vehicle as long as you need it. Unlike car sharing, you have exclusive access to a vehicle for as long as you remain subscribed.
  • Ability to change vehicles as you need. Some subscription services will let you swap your vehicle when you want.
  • No ongoing obligation. You will generally be able to cancel your subscription at any time (or at the end of the current billing period).
  • Can be expensive. The weekly or monthly subscription fee can often be quite high and you don't have the benefit of getting the car as an asset.
  • Vehicle choice may be limited. Like car sharing, the range of vehicles you can choose from will be smaller than if you were to buy a car.

What costs do I need to be aware of?

It can be hard to calculate the exact cost of each option, as this will be determined by factors such as the type and age of car, how much you use it and how long you need it for. However, there are a number of general costs you will need to keep in mind when considering each of the options outlined above.

Car ownership

  • Purchase price of the vehicle. This is the biggest single cost of car ownership and can be covered by either your own savings, car finance or a combination of the two.
  • Repairs and maintenance. You're responsible for paying for all necessary repairs and servicing that the car needs.
  • Registration and insurance. You need to have the car registered and at least compulsory third party insurance to be able to drive it.
  • Fuel. You also need to cover the cost of petrol.
  • Cost of finance. If you use a car loan or other form of finance to purchase your vehicle, you will also need to consider the cost of the finance.

Car sharing

  • Deposit bond. You will generally be charged a security deposit that is refunded if you return the car in good working condition.
  • Rental cost. Your payment covers the lease of the car and will vary depending on which type of vehicle you hire.
  • Insurance, registration and maintenance. While you aren't responsible for registering or repairing the vehicle, these costs are still included as part of your regular fee.
  • Fuel. You always have to cover the cost of the petrol you use and will need to refill the tank before returning the vehicle.
  • Excess distance fee. Some car sharing platforms may charge a fee if you go above the daily kilometre allowance.

Car subscription

  • Rental cost. Your subscription fee covers the cost of renting the vehicle you choose and differs based on which brand and class of vehicle you choose.
  • Insurance, registration and maintenance. As with car sharing, these costs are included in your subscription fee, even if you're not individually responsible for registering or repairing the vehicle.
  • Fuel. You also have to cover the cost of the petrol.
  • Security deposit. You may need to pay an initial deposit that will be returned once you cancel your subscription, provided you haven't damaged the vehicle.

You should always try and calculate the specific costs of each model of car access to find the one that makes the most financial sense for your situation. If you're considering car sharing or car subscription, you should contact the provider directly to see the likely costs. If you're considering car ownership, you can use our car loan calculator to help work out the potential cost of your car finance.

Which one is right for me?

You should find the statement below that best describes your situation to work out which model may best suit your needs:

Car ownership

  • You need long-term and constant access to a car.

Car-sharing

  • You need occasional access to a car, such as for weekends or trips away.

Car subscription

  • You need ongoing access to a car, but only for the short- to medium-term.

Car ownership or car subscription

  • You need access to a car as part of your daily commute.
  • You have a lack of public transport or alternative transport options.
  • You need regular access to a car and at all times of day.

Car sharing or car subscription

  • You need different vehicles for specific purposes, such as using a van or ute when moving house.
  • You only need access to a car for a couple of weeks.

Compare car loans

Rates last updated February 17th, 2019
$
Name Product Interest Rate (p.a.) Comparison Rate (p.a.) Min Loan Amount Loan Term Monthly Service Fee Application Fee Product Description Monthly Repayment
Latitude New and Used Car Loan
From 6.99% (fixed)
8.1%
$5,000
1 to 7 years
$10
$295
You'll receive a fixed rate between 6.99% p.a. and 14.99% p.a. based on your risk profile
Apply for a loan from $5,000 to finance a new or used car. Flexible repayments and options to finance a classic car.
IMB New Car Loan
5.89% (fixed)
6.24%
$2,000
1 to 7 years
$0
$250
You'll receive a fixed rate of 5.89% p.a.
A low minimum borrowing amount of $2,000 that you can use to purchase a new car or one up to two years old.
Beyond Bank Low Rate Car Loan
From 5.69% (fixed)
5.97%
$25,000
1 to 7 years
$0
$175
You'll receive a fixed rate of 5.69% p.a.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.
Stratton Finance New Car Loan
From 5.14% (fixed)
5.8%
$18,000
1 to 7 years
$8.90
$457 (for private seller vehicles this fee is $608)
You'll receive a fixed or variable rate depending on the lender you are approved with
Apply for up to $100,000 and use cash or trade in a vehicle to use as a deposit. Optional balloon payment available.
Loans.com.au - New Car Loan
5.44% (fixed)
5.99%
$5,000
3 to 5 years
$0
$400
You'll receive a fixed rate of 5.44% p.a.
Finance a new car and benefit from features such as fast approval, no ongoing fees and an optional balloon payment.
RACV New Car Loans
From 5.99% (fixed)
6.55%
$15,000
1 to 7 years
$0
$399
You'll receive a fixed rate of 5.99% p.a.
A larger loan of $15,000 or more to help you buy a new or used car. 5-hour pre approval available and no ongoing fees. Note: Product only available to residents of Victoria.
Westpac Car Loan
From 8.49% (fixed)
9.67%
$10,000
1 to 7 years
$12
$250
You'll receive a fixed rate of 8.49% p.a.
Finance a new or used car and benefit from convenient features for car buyers including a car search tool and the option to borrow extra for on-road costs.
St.George Secured Personal Loan - Fixed Rate
From 8.49% (fixed)
9.6%
$3,000
1 to 5 years
$12
$195
You'll receive a fixed rate from 8.49% p.a. based on the value of your car
Get a competitive rate and apply for a larger loan up to $80,000 when you attach a new or used car as security to the loan.
Australian Military Bank Car Loan
From 5.71% (fixed)
6.57%
$1,000
1 to 7 years
$10
from $100 to $500
You'll receive a fixed rate between 5.71% p.a. and 8.66% p.a. based on your personal credit history
A flexible loan to help you finance a car, motorbike or boat up to five years old.
Latitude Car Loan
From 6.99% (fixed)
8.1%
$5,000
1 to 7 years
$10
$295
You'll receive a fixed rate between 6.99% p.a. and 14.99% p.a. based on your risk profile
Finance a new or used car up with loans from $5,000 and benefit from flexible repayments.
IMB Secured Personal Loan
6.89% (fixed)
7.24%
$2,000
1 to 5 years
$0
$250
You'll receive a fixed rate of 6.89% p.a.
Benefit from this competitive rate by securing the loan with a vehicle up to 6 years old. Use this flexible loan for any purpose.

Compare up to 4 providers

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Car Loan Offers

Important Information*
Latitude New and Used Car Loan

You'll receive a fixed rate between 6.99% p.a. and 14.99% p.a. based on your risk profile
Apply for a loan from $5,000 to finance a new or used car. Flexible repayments and options to finance a classic car.

Beyond Bank Low Rate Car Loan "Special Offer"

You'll receive a fixed rate of 5.69% p.a.
Take advantage of a competitive rate, pre-approval and no early repayment fees when you finance a car under two years old.

RACV New Car Loans

You'll receive a fixed rate of 5.99% p.a.
A larger loan of $15,000 or more to help you buy a new or used car. 5-hour pre approval available and no ongoing fees. Note: Product only available to residents of Victoria.

Stratton Finance New Car Loan

You'll receive a fixed or variable rate depending on the lender you are approved with
Apply for up to $100,000 and use cash or trade in a vehicle to use as a deposit. Optional balloon payment available.

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