Australia is the cheapest place to own a car

Green slip cheapest place

Did you know Australia is the cheapest country to buy and run a car? Even though it seems expensive to buy and own a car, our high incomes makes it more affordable for us than for other nations. At the same time, Australians are bucking the international trend for buying smaller, more fuel efficient vehicles. We still prefer SUVs and Utes.

Australia is the cheapest place to own a car

Scrap Car Comparison (UK) analysed data from 40 countries to find out where it was most affordable to buy and run a new car. Australia came top of the list. It takes only half (49.5%) of the average salary to buy a VW Golf or Toyota Corolla and drive it for a year.

Share of average
annual salary
1. Australia 49.5%
2. USA 54.9%
3. Denmark 60.3%
4. Canada 64.4%
5. Sweden 75.8%

Turkey is the dearest place to own a car

Meanwhile, in Turkey it costs 6.5 years of working for an average salary to buy and run the same cars.

Share of average
annual salary
1. Turkey 652.3%
2. Argentina 515.8%
3. Colombia 508.9%
4. Uruguay 443.7%
5. Brazil 441.9%

However, we know from monthly sales figures that Australians favour Toyota Corollas but they are more likely to buy a new Ute.

Most popular new car in Australia

In July 2021 Toyota Hilux once again was the highest selling vehicle, followed by Ford Ranger and Toyota Corolla. Sales of SUVs were up 15% and light commercials were up 41% this July compared to last, a clear indication of consumer preference.

In the 7-month period January to July 2021, total new sales were clearly in favour of SUVs:

  • Passenger 21.2%
  • Light commercial 23.7%
  • SUV 51.3%

In fact, sales of new SUVs have more than doubled in 10 years from only 25% in 2011.

There’s no doubt Australians prefer to buy large vehicles and they prefer SUVs over smaller hatchbacks or sedans. At the same time, they are not flocking to buy electric vehicles. While the percentages look large – EV sales grew 260% in the year to July 2021 – actual numbers are still quite small.

Australians don’t follow the car trend

National Transport Commission’s report in August 2021, Carbon Dioxide Emissions Intensity for New Australian Light Vehicles 2020 shows Australians are not following international trends in their choice of new cars.

While manufacturers are trying to improve the fuel efficiency of their new models, Australian buyers want heavier vehicles with larger and more powerful engines. Australia also lacks the fuel quality standards that could attract more fuel efficient cars into our market.

It’s hard to see how there could be a huge turnaround in consumer preference towards electric vehicles. There are so few signs that EVs offer the kinds of features Australians demand – for a price they can afford.

Get the cheapest price for your greenslip.

Corrina Baird

Writer and expert

Corrina used to lend her car to her kids and discovered first hand what Ls, Ps and demerits mean for greenslips. After 20 years of writing and research in financial services, she’s an expert in the NSW CTP scheme. Read more about Corrina

your opinion matters: