The average Australian now expects that the annual cost of running a vehicle (including registration, insurance, fuel and maintenance) is $15,754.
This is according to a sample of over 1,040 drivers in Carbar's Future Finance and Mobility Report, an annual study into finance trends in the automobile industry.
This is up 78% from the equivalent results in 2022, where motorists suggested their average spend was $8,926.
These figures are in-line with the estimate in the RACV's cost of ownership study that car maintenance in Australia costs between $10,000 and $25,000, depending on make and model.
RACV research also indicates the Nissan Patrol and Toyota Landcruiser are some of the most expensive cars to run.
The surge in fuel prices was a significant contributor to the increase in expected running costs, with the average annual spend jumping from $1,991 in 2022 to $2,929 in $2023.
Of the respondents, 60% said that they weren't in control of their petrol costs, more even than those who were struggling with their grocery bills (53%).
Inflation though has penetrated many of the other aspects of car ownership.
Annual parking costs are this year expected to be $1,101 (up 235% from 2022), while the average Aussie driver can expect to shell out $1,800 in insurance fees (up 85%).
After eight successive cash rate hikes from the RBA, higher interest rates have also seen a jump in car repayments, which are now up to $1,652 from $781 in 2022.
State governments are also adding to the cost burden for careless motorists, who are expected to pay 227% more in infringement fines this year, up to $986.
Are used vehicles more cost-effective?
The report also revealed a reversal of the 2022 trend towards used cars.
One in three (33%) of Australians indicated their interest in buying a vehicle in 2023.
Of these people, 20% said they were interested in a new car, compared to 16% in the market for a used car.
About 42% of those interested in buying a car said they were concerned about the reliability of second hand vehicles.
However, Carbar co-founder and CEO Des Hang said cost of living pressures would also likely erode any advantage to pursuing a newer vehicle.
"We believe increased demand for new vehicles will reverse course as more Australians realise both the ongoing cost of purchasing a new vehicle and also the delays seen with accessing them," Mr Hang said.
"Cost of living pressures have already put a dent in new car orders, and we believe this trend will continue.”
Another upward trend revealed by Carbar was continued interest in electric vehicles.
Baby Boomers (22%) have overtaken Gen Z (21%) as the generation most likely to buy an electric car if money was no issue.
What about ditching the car entirely?
Well over half (60%) of respondents said that the cost and hassle of owning a car stresses them out.
Almost a third of those in the market for a car reported that they were considering postponing or even rethinking their decision to buy a car.
Meanwhile, 3% of respondents (a number that equates to over 550,000 Australians over 21 when extrapolated across the population) say they intend to sell their car this year and not replace it.
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Picture by Charlie Deets on Unsplash
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