How Much Does It Really Cost to Own a Car in Australia in 2025

 

For many Australians, owning a car is a necessity rather than a luxury. Whether it’s commuting to work, running errands, or taking road trips along the coast, having a vehicle offers freedom and flexibility. But behind the convenience lies a financial reality that often catches new owners off guard: the true cost of car ownership in 2025.

When budgeting for a car, most people only focus on the purchase price. In reality, the ongoing costs can add up to thousands of dollars each year. From fuel to insurance, registration fees, servicing, and depreciation, understanding the full picture is essential before committing to a new set of wheels.

For a more detailed breakdown, you can read the full guide here: How Much Does It Really Cost to Own a Car in Australia in 2025.

1. Fuel and Energy Costs

Even as electric vehicles (EVs) gain popularity, fuel remains a significant cost for petrol and diesel car owners. In 2025, fluctuating global oil prices and rising demand for energy have kept fuel costs high. EV drivers, while saving on petrol, face new expenses with charging infrastructure and electricity tariffs.

Key factors influencing fuel/energy costs:

  • Daily commuting distance

  • Type of vehicle (petrol, diesel, hybrid, or EV)

  • Regional fuel prices or electricity rates

  • Driving style and maintenance habits

2. Insurance and Registration

Insurance premiums in Australia continue to rise due to higher repair costs for modern, tech-heavy vehicles. On top of that, compulsory third-party (CTP) insurance and annual registration fees vary across states, making ownership more expensive in some regions than others.

Tips to save on insurance:

  • Compare policies across multiple providers

  • Bundle insurance with other products (home or contents)

  • Opt for a higher excess if financially manageable

3. Servicing and Maintenance

A common misconception is that modern cars are “maintenance-free.” While EVs generally require fewer service appointments than petrol cars, their specialised parts can be expensive when things go wrong. Regular servicing not only keeps your car roadworthy but also helps avoid surprise bills.

4. Depreciation: The Silent Expense

Perhaps the most overlooked cost of owning a car is depreciation—the loss of value over time. New cars lose the most in their first three years, and resale values in 2025 are becoming more unpredictable with the rapid rise of EVs.

Depreciation factors include:

  • Brand reputation and reliability

  • Market demand for the model

  • Kilometres driven per year

  • Condition and maintenance history

5. The Bottom Line

When you add up these costs—fuel, insurance, registration, maintenance, and depreciation—the true cost of owning a car in Australia can far exceed the initial purchase price.

If you’re planning to buy in 2025, it’s wise to budget realistically and factor in these ongoing expenses. For an in-depth analysis and useful insights, check out the full article here: How Much Does It Really Cost to Own a Car in Australia in 2025.

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