Most UK drivers underestimate the true cost of car ownership by a third or more, because depreciation is invisible until you sell. This guide breaks down the six real costs — fuel, insurance, tax, MOT, servicing and depreciation — for petrol, diesel, hybrid and EV ownership in 2026, so you can budget honestly and compare cars on a like-for-like total basis.
At 145p per litre petrol and 50 mpg, every 10,000 miles costs £1,318 in fuel. A 35 mpg larger petrol or 4x4 costs £1,883 over the same distance. A 60 mpg modern diesel costs £1,098. An EV at 4 miles per kWh on a 7p overnight tariff costs £175; on full daytime electricity (28p) £700; on rapid public charging (75p/kWh) £1,875 — the EV cost case lives or dies on home charging.
Hybrids are between, typically 55 to 70 mpg in real-world mixed driving. Plug-in hybrids only hit headline figures if you genuinely charge daily — with a flat battery they often return worse than a regular hybrid because of battery weight.
Average UK comprehensive insurance reached £622 in 2025 according to ABI figures, but distribution is wide. Drivers under 25 pay £1,500+, drivers in their 50s with full no-claims often £350. Postcode, car group and annual mileage matter more than most drivers realise.
Telematics ('black box') policies typically save £200 to £500 for younger drivers. Adding a named older second driver can reduce premiums for primary younger drivers — but only if they genuinely drive the car. EV insurance has converged with petrol after years of being more expensive.
VED for cars first registered after April 2017 is £190/year standard (2025/26 rates), with a £410 luxury supplement for years 2 to 6 if list price exceeded £40,000. EVs lose their exemption from April 2025 and now pay both the standard rate and (for cars over £40,000) the luxury supplement.
Pre-2017 cars use the older CO2-banded system, which can be cheaper for low-emission cars but punishingly expensive for older high-emission models — up to £735/year for the worst polluters. Always check VED before buying a 2010-2016 car.
MOT is £54.85 maximum (annual after 3 years from first registration). Standard service runs £150 to £300; major service every 2 years or 20,000 miles £300 to £600. EVs typically halve servicing costs because there is no oil, no spark plugs, no exhaust and far less brake wear.
Tyres are the silent budget killer: a set of four mid-range tyres for a family car runs £400 to £700, replaced every 25,000 to 35,000 miles. Performance cars and SUVs eat tyres faster. Budget £150 to £300/year for tyres on average use.
A typical mainstream petrol family car loses 50 to 55 percent of value in the first 3 years and 65 percent by year 5. On a £25,000 new car that's £16,250 of depreciation in 5 years — £3,250/year, far more than fuel and insurance combined.
Buy a 3-year-old car instead and the steepest depreciation has already happened. Current EV residuals lag petrol equivalents by 5 to 10 percentage points because of battery anxiety and rapid model improvement, making used EVs particularly good value in 2026.
Used (3 to 5 year old) hybrid or small petrol with low insurance group. New EVs win on running costs only with home charging and willingness to keep the car 7+ years.
Leasing fixes monthly cost and avoids depreciation surprises but costs more long-term. Buying outright is cheapest if you keep cars 5+ years.
Manufacturer warranties cover defects but not wear items — tyres, brakes, clutches, batteries. Always read what is and isn't included.
Real total cost of ownership for petrol, hybrid and electric cars in the UK in 2026 — fuel, charging, tax, insurance, depreciation and home charger costs.
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