What a car costs to run in a year

The estimate uses the Department for Transport's average annual mileage, owner-reported fuel economy and published insurance prices by age band. Each input is shown with its publication and applicable date, and calculated figures include the arithmetic used.

The mileage matters most, because two lines scale with it and three do not. At 7,100 miles a year, the average for a car in England, fuel is the largest single line but it is not the majority of the bill. Drive twice that and fuel dominates everything else. Drive half of it and the fixed lines, tax, insurance, the service and the test, make up a larger share. Use your expected mileage when comparing two cars because it can change which one costs less.

Depreciation is usually the largest cost for a newer car. It is shown separately because it depends on purchase price and is realised when the car is sold rather than paid as a regular bill.

The monthly averages show how far a current weekly price can move over a year. Diesel stayed within a few pence for eighteen months, rose sharply over two months in spring 2026 and then fell more slowly. No sourced explanation is available for the movement. The series shows that the price difference between petrol and diesel is not fixed.

A yearly budget should allow for the monthly range rather than use one weekly price. If diesel moves from the cheapest to the dearest month in this series, the change in annual fuel cost exceeds the combined annual cost of tax and an MOT for the comparison car.

In this estimate fuel is the largest line and insurance is close behind it, while the three certain, fixed, unavoidable costs, tax, the service and the test, come to less than either. That is the shape of an average mileage petrol car. A high mileage diesel tips heavily towards fuel, and a young driver's first car tips so far towards insurance that nothing else in the table matters much.

The tax line here is the flat standard rate for a car in the current regime past its first licence. A car registered between March 2001 and March 2017 pays its CO2 band instead, which can be well above or well below this figure, and a car carrying the expensive car supplement pays considerably more. The tax rates page has every band if the car you are looking at is not in the simple case.

The practical use of a curve like this is not predicting a sale The curve shows when depreciation is steepest. A three year old car has already incurred the largest early losses, so the same purchase price generally buys more car at three years old than at one. From about year four, the percentage loss applies to a smaller value, so the annual cash loss falls even when the rate does not.

Against that, the running costs in the table above tend to rise as a car ages, because a service on an older car turns up more work and wear items start arriving together. Somewhere in the middle of the curve is the cheapest total cost of ownership, and for most ordinary cars it sits several years further along than people expect.