Alarming jump in ownership costs for cheap cars in South Africa

Ownership costs for entry-level cars have skyrocketed in South Africa over the past 13 years.
In most cases, monthly instalment costs, insurance premiums, and fuel expenses have more than doubled during this period.
The dramatic rise is largely attributed to rapid fuel and vehicle price inflation, the depreciation of the South African rand, and higher interest rates.
Finance house WesBank illustrated the growing financial pressure on consumers by comparing the total running fees of an entry-level vehicle in 2025 with what it would’ve cost in 2012.
Today, a mid-range hatchback with a retail price of around R294,000 – such as the VW Polo Vivo Life – sees an estimated monthly instalment of R5,555.
“This instalment is, of course, influenced by the interest rate linked to the vehicle finance contract, which in turn is influenced by factors such as credit score and loan term,” said Lebo Gaoaketse, Head of Marketing and Communication at WesBank.
Insurance premiums of R1,827 can be expected for this same vehicle, though it will vary on a driver-to-driver basis.
Insurance costs are decided on factors such as the make and model of the car, as well as the driver’s history and address.
Despite recent improvements in the price of fuel, this remains one of the largest ongoing expenses in vehicle ownership.
WesBank approximates that the average owner of a budget-friendly hatch spends around R3,903 per month on propellants.
Of course, one also has to take into account maintenance fees to ensure the safe and reliable operation of your wheels.
For the study vehicle, owners can expect to pay in the region of R476 per month, or R5,709 annually, which covers routine maintenance and general upkeep.
All in, the total monthly cost for one of the best-selling hatchbacks in South Africa comes to roughly R11,760.
A look into the past
Reviewing historical data, the dramatic increase in the total cost of vehicle ownership over the last 13 years becomes more apparent.
Back in 2012, the equivalent VW Polo Vivo of the time cost in the region of R120,000, versus R294,000 today.
Likewise, the average prime interest rate in 2012 was pegged at 8.5%, in comparison to the 11.00% we currently have to pay.
Meanwhile, fuel prices in May 2012 stood at R12.22 per litre of petrol 95. In May 2025, that same volume of liquid gold goes for a much higher R21.40.
Many things have contributed to these ballooning expenses, such as a depreciating rand, developing geopolitical tensions, rising oil prices, poor infrastructure, and more.
Regardless of what caused it, South African motorists are stuck paying far more on getting around today than they were 13 years ago.
The finance, insurance, and fuel costs for an equivalent vehicle in 2012 compared to 2025, according to WesBank, are detailed below:
Cost | 2012 | 2025 | Difference |
---|---|---|---|
Finance instalment | R2,417 p/m | R5,555 p/m | R3,138 p/m |
Insurance premium | R803 p/m | R1,827 p/m | R1,025 p/m |
Fuel costs | R1,857 p/m | R3,903 p/m | R2,046 p/m |
Total | R5,076 p/m | R11,285 p/m | R6,208 p/m |
Viewing the cost of vehicle ownership from this perspective is important, said WesBank’s Gaoaketse.
“It underscores the need to objectively and honestly evaluate one’s affordability level before signing a long-term vehicle finance contract, to ensure a fulfilling vehicle ownership experience,” he said.