The real cost of running a car: a worked example

The price of the car is only the beginning. Fuel, insurance, registration, servicing, tyres, tolls and parking all add up, and fuel prices can change every month. Working out the full monthly cost helps you decide whether a car is worth it.

The costs to include

• Fuel: changes monthly in the UAE. Khaleej Times reported Special 95 petrol at AED 4.28 per litre for October 2026, up from AED 3.69 in September 2026.
• Insurance: yearly, required for registration (third-party at minimum; see the previous lesson).
• Registration and inspection: yearly in most cases for private used cars (CarSwitch).
• Servicing and repairs: oil changes, filters, brakes, batteries (the RAC notes batteries over four years old may be near the end of their life).
• Tyres: a full set every few years, plus repairs.
• Tolls, parking and fines: easy to forget, but they can be a large monthly cost in a city.

Worked example: the assumptions

• This example uses invented round numbers for practice only. Get real quotes for your own car before deciding anything.
• Assume the car uses 8 litres per 100 km and you drive 1,000 km a month.
• Assume fuel at AED 4.28 per litre (Special 95, October 2026, Khaleej Times).
• Assume yearly costs of AED 2,400 insurance, AED 600 registration and inspection, AED 1,500 servicing and AED 500 set aside for tyres (a set at AED 2,000 lasting four years).
• Assume AED 150 a month for tolls and parking.

Worked example: the maths

• Fuel: 1,000 km at 8 litres per 100 km is 80 litres. 80 x AED 4.28 = AED 342.40 a month.
• Yearly costs: 2,400 + 600 + 1,500 + 500 = AED 5,000 a year, which is AED 5,000 / 12 = about AED 416.67 a month.
• Monthly total: 342.40 + 416.67 + 150 = about AED 909.07 a month, or about AED 10,909 a year.
• Cost per kilometre: 909.07 / 1,000 = about AED 0.91 per km. Compare that with metro, bus, cycling or ride-hailing for your usual trips.
• Fuel sensitivity: at September 2026's AED 3.69, the same 80 litres cost AED 295.20, so the monthly fuel bill rose by AED 47.20 in one month.

Cutting the cost safely

• Keep tyres at the right pressure and the car serviced: neglect costs more later, as mechanics quoted by Khaleej Times point out about small leaks.
• Use the fuel grade your handbook recommends rather than a more expensive one by habit.
• Combine errands into one trip and avoid peak-hour journeys where you can.
• Shop around for insurance every year, comparing the same cover and excess.
• Never cut costs on safety items such as tyres, brakes or insurance cover.

Do you even need a car?

• Many university cities abroad have good public transport and expensive parking; students often do not need a car at all.
• Add a car's monthly cost to your student budget (see Money Basics: university budget) and see what it displaces.
• Car sharing, occasional rental or ride-hailing can be cheaper if you only drive now and then.
• Revisit the decision every term as your timetable and housing change.