Most Fuel-Efficient Cars in Australia

30 Jan 2023

Have you ever stopped and done the math to see how much you’re paying every year just to fuel up your car? For the typical Australian, this number is in the thousands of dollars. This is what motivated MNY’s newest research study: drilling down into how much every vehicle model costs its owner in fuel. We will help you find the right balance between affordability, comfort, and efficiency so that you can get where you need to go without overpaying each year.

The goal of this study is to help Australian consumers pick the car that is the very best fit for them and can save them the most on fuel costs. Our unique and interactive tool lets users adjust for a wide variety of driving habits and preferences. This produces a personalised result that will lead to optimal fuel savings. Use our tool to find the most fuel-efficient car that fits your needs and your budget.

Moreover, this calculator is built on data points which provide valuable insights about the fuel efficiency of vehicles currently available in Australia. We included 652 vehicle models from 38 different car manufacturers, with reliable fuel efficiency data and sufficient representation on Australian roads for our analysis. Fuel and electricity prices were assessed by each state and territory in order to ensure the most accurate estimate.

These six vehicles, one for each engine type, are the models that cost the least to fuel per year. Two are Hyundais, two are Toyotas, one is an Audi, and one is a Land Rover. The best fuel costs across these six categories range from $491 for a pure electric car to $1,678 for a diesel hybrid.

Where do our numbers come from?

Before diving into our recommendations, it helps to understand the sources for our research, as well as the assumptions that we made in order to build your estimates.

Sources for our data points

MNY used a diverse array of reputable sources from both public and private institutions. We collected the most recent numbers available for each parameter, and cross-verified across several sources when we noticed discrepancies.

For engine specifications, we referred to the Australian government’s Green Vehicle Guide as well as individual car manufacturer websites.

Vehicle pricing data were derived from aggregated averages across both new and pre-owned models, ascertained from comprehensive marketplaces including CarsGuide, CarExpert, Drive, and CarSales, to ensure a robust analysis of cost factors.

The baseline average fuel costs were sourced from FuelPrice.io and subsequently cross-verified with actual data from major petrol station chains such as 7-Eleven, BP, Caltex, United, Mobil, and Shell, when available, to ensure accuracy and reliability of the pricing data.

And for average electricity costs, which take into account both at-home charging and public charging stations, we consulted Rollin’ Car Insurance, Finder, and Canstar Blue.

Assumptions made for calculation of estimates

Because no two drivers are completely identical, MNY needed to make some baseline assumptions based on typical driving habits. We want to be transparent about how exactly our estimates are constructed.

To begin, we assumed an annual distance traveled of 14,000 km for our study, based on the average distance covered by motorists each year.

From there, we broke it down by vehicle type:

  • For petrol vehicles

    We calculated the annual fuel consumption based on the type of fuel used and its consumption per kilometre.
  • For hybrid vehicles

    We calculated fuel consumption by considering both petrol usage (L/100 km) and electricity usage (kW/100 km), reflecting their use in an interchangeable fashion during travel. This approach accounts for the combined energy usage to provide a comprehensive cost estimate.
  • For electric vehicles

    We considered the electric battery capacity and the cost of electricity for homeowners and at public charging stations.

Understanding the summaries of our overall results

For our Ten Most Efficient Cars and Ten Least Efficient Cars, we included one vehicle from each manufacturer, even if a single manufacturer had two very efficient cars or two very inefficient cars. This provided a better picture of the biggest manufacturers’ strongest and weakest options for fuel efficiency.

You should also note that we evaluated efficiency from the perspective of a consumer’s overall fuel expenses during the course of an entire year. We believe this to be a more relevant calculation for the typical Australian compared to efficiency of fuel consumption under optimal testing conditions, which don’t always reflect the real world.

Our Findings

As you read on, you’ll learn the most important things that we found as a result of our comprehensive research. These graphs explore the relationships between fuel efficiency, makes and models of vehicles, vehicle prices, and vehicle body types.

Ten Most Fuel-Efficient Cars in Australia

Model Release YearMakeModelBody StyleFuel TypeBase PriceAnnual fuel cost, AUD($)
2019HyundaiIoniqSedan
$36,630$491
2020TeslaModel 3Sedan
Pure Electric
$60,280$554
2019BMWi3Sedan
Pure Electric
$51,370$575
2023Fiat500eHatch
Pure Electric
$52,500$605
2021LexusUX 300eHatch
Pure Electric
$60,610$630
2021KiaNiroWagon
Pure Electric
$57,640$668
2022BYDATTO 3Wagon
Pure Electric
$48,510$672
2021Mercedes-BenzEQA ClassWagon
Pure Electric
$70,730$680
2020MGZS EVSUV
Pure Electric
$36,740$680
2022VolvoC40Hatch
Pure Electric
$70,400$706

The top ten cars for fuel efficiency all have an annual fuel cost of around $500 to $700 per year, which is very low compared to the average vehicle. The savings primarily come from the fact that these cars are purely electric and do not use petrol in any form.

However, most of these vehicles are also slightly more expensive than what the typical Australian consumer purchases. Therefore, accessing these fuel savings will often mean paying more money on the front end.

These cars also trended towards smaller, lighter body styles which require less power to get going. Since most electric vehicle charging stations are concentrated in urban areas, and EV drivers are usually wealthier Australians living in large cities, it makes sense that these vehicles have city-friendly designs.

The final point to note is the diversity among top manufacturers: European and Asian companies alike are responding to market demands by actively pursuing optimal fuel efficiency.

Ten Least Fuel-Efficient Cars in Australia

Model Release YearMakeModelBody StyleFuel TypeBase PriceAnnual fuel cost, AUD($)
2023BMWAlpinaWagon
$264,900$3,977.82
2021PorscheMacanSUV
Petrol
$122,210$3,331.02
2019LotusEvora GT 430Coupe
Petrol
$190,300$3,331.02
2020Aston MartinDB11Convertible
Petrol
$287,400$3,234.00
2023VolkswagenAmarokUtility
Petrol
$79,990$3,201.66
2020AlpinaB3Sedan
Petrol
$142,900$3,201.66
2022Land RoverL663 Defender 90/110/130SUV
Electric/Petrol
$122,980$3,082.52
2021Alfa RomeoGiuliaSedan
Petrol
$241,560$3,104.64
2020Mercedes-BenzGLA ClassWagon
Petrol
$94,710$3,104.64
2022SubaruBRZCoupe
Petrol
$40,190$3,072.30

On the opposite end of the spectrum from the most fuel-efficient cars are the least fuel-efficient cars, which have an annual fuel cost of up to $4,000. These cars are overwhelmingly petrol-based, though it’s notable that the #1 least fuel-efficient car is actually a petrol hybrid.

Curiously, the least fuel-efficient cars mainly come with very high prices for the vehicles themselves. This makes more sense when considering that many luxury cars do not prioritise fuel efficiency since their target customer is unlikely to be concerned about petrol expenses.

Additionally, these vehicle models come in all body types, although there are definitely some heavier builds here as compared to the ten most fuel-efficient cars. But beyond just the total weight, these cars also have larger engines that require substantially more power.

Overall, the worst performers for fuel efficiency are almost exclusively in the luxury category, wherein these vehicles are simply not built to save fuel but rather for more powerful driving experiences.

A deep dive into fuel efficiency trends

After determining the ten best and ten worst performers for fuel costs, we wanted to explore the data further and learn what additional trends we could uncover. This helps Australian car buyers better understand how fuel efficiency is determined. Below is a digest of our most interesting discoveries about the factors affecting annual fuel cost.

One of the largest factors in a vehicle’s fuel consumption is its body type. High-end vehicles with powerful engines, as well as vehicles designed for luxury rather than savings, will require more petrol. Here, convertibles and coupes are far and away the biggest fuel consumers.

Meanwhile, the lowest fuel costs are seen with hatches and sedans; in other words, cars that are smaller, lighter, and more aerodynamic. In between are slightly heavier vehicles such as SUVs, vans, and wagons. The weight of those last three categories is a core reason for why they have worse fuel efficiency and higher fuel costs.

However, you should remember that this only displays the averages for each category, and that there is a great deal of variety for each body style. Many SUVs consume less fuel than many sedans, simply because the SUV may be built with newer technology or may feature a smaller engine.

For most consumer vehicles, the trendline is very clear. Petrol vehicles have the highest fuel costs, but as you advance through petrol hybrids and plug-in hybrids all the way to pure electric vehicles, the annual costs sharply decrease.

To better understand the source of these results, it also helps to know the differences between hybrids. A petrol hybrid primarily uses petrol and internally charges a small battery with the energy from coasting and braking. Meanwhile, a plug-in hybrid is fueled with petrol but also has a larger, supplemental battery that can be charged externally.

The most surprising result comes from diesel hybrids, which average higher fuel costs than their pure-diesel counterparts. However, this makes sense when considering that most diesel hybrids are SUVs, which tend to be heavier and bulkier. Diesel hybrids also come from premium brands like Land Rover, Jaguar, and BMW, whose customers generally value performance over fuel economy.

Another way of assessing fuel efficiency is by comparing the purchase price of the vehicle to the average amount spent on fuel each year. For instance, imagine you buy a car for $40,000 and spend $2,000 on fuel each year. The purchase price to fuel cost ratio is 20:1 because your purchase price is twenty times greater than your annual fuel expense.

A large proportion of vehicles have a price to fuel ratio between 10 and 20, and a strong majority have ratios between 10 and 40. There are also some vehicles with ratios as low as 7 or 8. This is the case when the car itself is inexpensive, but it has poor fuel efficiency and requires you to spend a lot on petrol each year.

In the middle of this range, there are vehicles with both reasonable purchase prices and fairly low fuel expenses. These typically include hybrids or more affordable EVs that have smaller fuel costs. However, they can also include petrol vehicles that run very efficiently and therefore have a purchase price much larger than the fuel expense.

On the far end of the spectrum, there are significant outliers where the price to fuel ratio is over 300. This is mainly applicable for luxury supercars that cost hundreds of thousands of dollars but run on electric motors.

This graph illustrates the relationship between a vehicle’s purchase price and its annual fuel costs. Each dot represents one vehicle model, color-coded by engine type. Each engine type has a central cluster and then skews in a particular direction.

Electric vehicles clearly dominate in the way of having low fuel costs, but they also have a greater skew towards being more expensive to buy. Meanwhile, petrol vehicles have some of the lowest purchase prices but also the highest fuel costs. Hybrids are grouped in between those two categories.

The variation in fuel costs for each category is also very revealing. Electric vehicles of all prices consistently have low fuel costs. Meanwhile, petrol vehicles and petrol hybrids have the sharpest increases in fuel costs as the purchase prices go up.

Lastly, diesel and diesel hybrids make up a minority of vehicle types, and they are clustered together with moderate purchase prices and moderate fuel costs. They have fewer outliers compared to other engine types.

This graph shows battery ranges for both pure electric vehicles as well as plug-in hybrids. It is clear that plug-in hybrids have substantially lower range on their batteries, which makes sense since much of their driving distance is done with petrol.

You can also see that pure electric vehicles vary substantially in terms of the range that they cover. Notably, a higher purchase price does not have a very strong correlation with a longer range. Many of the more affordable electric vehicles can actually go farther on a single charge compared to their more expensive counterparts.

The pure-electric car offering the longest electric range is the 2020 Tesla Model S LongRange (SA3EB), reaching up to 720 km and approximately priced around $100,000. At the other end, the 2020 MINI Cooper Hardtop with an electric engine holds the shortest range of 220 km, retailing at about $55,000.

The goal of this graph is to explore how fuel efficiency rankings would change based on a rise or fall in petrol prices. The current ratio for the price of 1 L of petrol to the price of 1 KWh of electricity is about 7.3. In this graph, that base ratio is expressed as 1.00. Currently, electric vehicles and plug-in hybrid electrics make up a combined 89% of the top quarter of vehicles by fuel efficiency.

If the ratio of the price of petrol to the price of electricity were to rise by 50%, electric vehicles would start looking like a better and better deal, and would occupy as much as 94% of that top quarter.

However, if the price of petrol compared to the price of electricity were to fall by 50% from its current place, then petrol-powered vehicles become a comparatively more affordable choice. In that event, electric vehicles would only represent 51% of that top quarter of vehicles by fuel-efficiency.

Overall takeaways from MNY’s fuel efficiency study

Cars remain a significant expense for the majority of Australians, and many drivers are looking for ways to save money on vehicle expenses. While more and more manufacturers have developed hybrids and electric vehicles that have impressively low fuel consumption, these high-efficiency models often come with higher price tags.

This leaves many car shoppers searching for options with both an affordable purchase price and a reasonable annual fuel cost. Additionally, shoppers are factoring in the body style and engine type of the car and examining trade-offs between fuel efficiency versus comfort and convenience.

Armed with the results of this study, Australian consumers are more informed about the tangible benefits and drawbacks of each vehicle type. Additionally, they are more acutely tuned to the factors and conditions that affect fuel efficiency. This empowers consumers to make more educated choices about a car that fits their expectations for fuel expenditures while fulfilling the rest of their needs.