Budget cars more expensive to maintain

About this post

Motorists are being warned to look beyond the sticker price when buying a car and to factor in post-sales costs such as servicing, car insurance and a vehicle’s fuel economy, after new research found some budget-priced vehicles can cost more to maintain than a luxury car.

The Australian Automobile Association (AAA) found the cost of servicing a Nissan Micra hatchback, at $1584 over three years, to be more than 50 percent dearer than the cost of regular services of Volkswagen Golf at $876 over three years. The two cars cost $13,990 and $36,490 respectively, according to the study.

The Micra was even more expensive to maintain than Toyota’s heavy-duty LandCruiser, with the $80,000 4WD proving $324 cheaper to maintain over three years.

The report found the cheapest cars to maintain over the period were the Hyundai 120 ($567), Holden Barina ($740), Mitsubishi Mirage ($750) and Toyota Yaris ($780).

The study was based on car dealerships’ capped-price servicing costs, which were introduced to increase the transparency of car running costs and stop some rogue operators from over-charging. Before the introduction of capped-price servicing, prices varied widely even among dealers representing the same brand of vehicles.

AAA executive director, Andrew McKellar, said capped-price servicing does provide a greater level of transparency but people must read the fine print.

“Not all brands offer the same conditions or service period which means you may not be comparing apples with apples,” he said.

“Do your homework and examine all the details such as how many services you get at that fixed rate and also how often the service needs to be undertaken.”

Aside from the upfront costs and the price of maintaining a car, it’s important to factor in other expenses such as car insurance and a vehicle’s fuel economy.

A recent study from Canstar found the average car insurance premium for families is $1181, while under 25s pay $1361 on average each year, but premiums may vary widely between car models and driver profiles, among other factors.

So before you buy a car talk to your provider or use RateCity to get a quote on comprehensive car insurance so you know what you’ll be paying down the track.

As for fuel economy, all new light vehicles sold in Australia are required to display a Fuel Consumption Label to help motorists make informed choices about the environmental impact and running costs.



This is an information service. By browsing on the website and/or using our search tools, you are asking RateCity to provide you with information about products from multiple financial institutions. We will try to show you a range of products in response to your request for information. The search results do not include all providers and may not compare all features relevant to you, for further details refer to our FSCG. The rating shown is only one factor to take into account when considering these products. We are not a credit provider, and in giving you product information we are not making any suggestion or recommendation to you about a particular credit product. If you decide to apply for a product, you will deal directly with a financial institution, and not with RateCity. Rates and product information should be confirmed with the relevant financial institution, and you should review the PDS before you decide to purchase. See our terms of use for further details. This advice is general and has not taken into account your objectives, financial situation or needs. Consider whether this advice is right for you.