Owning a car in South Africa is often seen as a necessity rather than a luxury, although the cost of the blessed things does make it a purchase for the privileged. Be that as it may, with public transport limited in many areas, and ride-hailing costs adding up quickly, most households (privileged or not) eventually face the decision to buy a car.  

What must be considered before any such purchase is made, is the true cost of car ownership in 2025, which goes far beyond the monthly instalment on your vehicle finance agreement. 

Understanding what you are really paying for can help you budget properly, avoid financial strain, and make smarter decisions when it comes to choosing and maintaining your car. 

Instalments: The First And Most Obvious Car Ownership Cost 

For many South Africans, the first cost that comes to mind is the monthly instalment if the car is financed. According to the National Credit Regulator, the average new car loan term in SA is now around 72 months, with interest rates tracking the prime rate. In 2025, with higher interest rates still in play, this means instalments are a significant portion of household budgets. 

A small hatchback might cost R4,500 to R6,000 per month to finance, while a mid-size SUV can conservatively reach R9,000 to R12,000. The instalment often feels manageable on its own, but the real costs begin to add up when you add everything else together. 

Explore the AA Inform Guide to Car Finance to understand deposits, repayment terms, balloon payments, and your rights as a buyer. 

Insurance: Non-Negotiable Protection 

Car insurance is not legally mandatory in South Africa, but it should be treated as essential. Repair costs and accident risks make going without cover extremely risky. Comprehensive cover for a modest car can range from R1,200 to R2,500 per month, depending on your profile, the vehicle, the excess attached to your policy, and where you live. 

Some drivers opt for third-party only, which can be cheaper, but this leaves them exposed to the cost of repairing or replacing their own car. Either way, insurance is one of the most consistent and important car-related expenses. 

Fuel: A Moving Target 

Fuel is often the biggest monthly expense once the car is in your garage. South African motorists know how volatile petrol and diesel prices are, as they change monthly based on international oil prices and the rand/dollar exchange rate. 

As of mid-2025, a full tank of petrol for a 45-litre hatchback costs about R1,100. For most urban drivers, filling up twice a month means spending R2,200. Longer commutes or larger vehicles easily push that figure to R4,000 or more. Diesel drivers may save on consumption, but with diesel prices now close to petrol in many months, the difference is less pronounced. 

Maintenance And Repairs: The Hidden Expense 

Routine servicing is another cost that’s easy to overlook, especially if you have a service or maintenance plan included in your finance deal. Once these plans expire, however, owners can face large out-of-pocket costs. 

A basic annual service can cost around R3,000 to R5,000, while major services or unexpected repairs (such as brake replacements, shocks, or tyres) can reach R10,000 or more. Over the lifespan of a car, these costs average out to a few thousand rand per year, but they tend to spike suddenly. 

Licensing And Admin Fees 

This is a yearly expense that many of us forget about until we come to our cars and find the fine wedged under the windscreen wiper. To avoid paying fines, make sure that you renew your vehicle licence disc every year. The amount depends on the weight of the vehicle, so we can only provide you with an average range for a typical passenger car, which tends to sit at around between R600 and R1,200.  

Speaking of fines, it would be remiss of us not to mention traffic fines. While fines are avoidable, they are another reality of car ownership, as are toll fees if you travel on national highways. 

Depreciation: The Silent Cost 

Depreciation is often forgotten because you do not “pay” it monthly, but it is one of the biggest costs of all. Most cars lose 20% to 30% of their value within the first year, and around 50% within five years. What this means is that a R300,000 car which you have bought today, could be worth only R150,000 by 2030. 

Depreciation does not affect your cash flow directly, but it matters when you sell or trade in. We would say that having an understanding of this will help you to budget realistically and avoid surprises down the road. 

Feeling Informed? 

When you add everything together, the real cost of owning even a modest car can easily exceed R10,000 per month, which could be a far cry from the R3,900 that you initially thought you would spend. We’re sure you can see why financial experts recommend looking beyond the showroom price or monthly instalment, so that you can plan affectively and avoid every month feeling like financial carnage. 

If you’re planning to buy or upgrade in 2025, build your budget with these costs in mind. A car can be a lifeline in South Africa, but only if you own it with your eyes wide open.