If you’re thinking about buying your first car or considering leasing, it’s important to know the actual cost of owning a car in Dubai and all the hidden fees involved. Registration, insurance, Salik tolls, parking, and fines all add up. Knowing the full picture helps you budget and avoid surprises.
Why You Actually Need a Car Here
Dubai is huge. The Metro is great and the bus network keeps improving, but they don’t cover the whole city and they don’t run all night. If you live away from the main Metro line, a car isn’t a luxury. It’s your way to get to work, buy groceries, or explore the UAE.
Rush hour traffic is heavy, and the desert heat is hard on cars. Still, having your own car gives you freedom that public transport can’t match. Here’s what it really costs to own and run a car in Dubai, based on current numbers and my own experience.
Up-Front Purchase & Financing: The First Hurdles
The Sticker Price and The Drop in Value
New car prices in Dubai are all over the place. If you just want a reliable daily driver, something like a Toyota Corolla will set you back around AED 70k–80k. If you want an SUV or a luxury brand, expect to pay AED 250k or more.
One thing to remember: cars in Dubai lose value fast. You’ll lose 20%–30% in the first year alone. I suggest looking at Certified Pre-Owned cars. They usually come with a warranty and cost less than new.
Financing the Dream
If you’re not paying cash, you’ll probably need a loan. Most banks want a 20% down payment and offer up to 5 years to pay it off.
• For a mid-range sedan (~AED 80k): Expect monthly payments between AED 1,200 and AED 1,500.
• For SUVs or Luxury cars: You’re looking at AED 2,500–4,000+ per month.
• Interest Rates: Currently, they are hovering between 2.9% and 4.5%, depending on your credit history and whatever promotion your bank is running.
To make sure you are getting the most competitive deal, it is worth checking out our guide to the best bank accounts in Dubai, as many banks offer exclusive lower interest rates or cashback on car loans if you transfer your salary to them.
Registration and Licensing: The Bureaucracy
Getting a New Car on the Road
Registering a vehicle with the Dubai Roads and Transport Authority (RTA) involves several fees. It’s not just one payment; it’s a mix of fixed and variable costs. Here is what you need to have ready:
• Basic Registration Fee: AED 420 (Standard for everyone).
• Transfer of Ownership: AED 350 (Only if you are buying used).
• Vehicle Inspection: AED 170 (The mandatory safety check).
• Traffic File Creation: AED 220 (A one-time fee if this is your first car in Dubai).
• Knowledge & Innovation Fee: AED 20 (A standard government surcharge).
• License Plates: These start at AED 35 for standard plates, but if you want a special “gold” number or a specific digit combination, the sky is the limit – prices can soar over AED 4,500.
The Annual Renewal Ritual
You have to renew your registration every year. It costs AED 380. If your car is over three years old, add AED 170 for inspection. Card delivery is another AED 25. If you’re late, you pay AED 25 per month after a 30-day grace period. Most of this is now easy to do in the RTA app.
Parking: The Daily Hunt
Unless you get lucky, you’ll pay for parking in most areas. The price depends on the zone and the time of day.
- Commercial Zones (A & B): These are the busy business areas. Expect to pay AED 4/hr during peak times (8 AM – 10 PM), or AED 2/hr off-peak. The daily cap is AED 50.
- Residential Zones (D–K): A bit cheaper at AED 2/hr (peak) and AED 1/hr (off-peak), capped at AED 15/day.
- Premium Zones (T & Z): These are prime spots. You’ll pay AED 8/hr (peak) or AED 4/hr (off-peak), with a steep AED 100 daily cap.
Ways to Save
If you park in the same area every day, get a permit.
Residential Permit: Costs AED 150–400 per month, but you need proof that you live there.
Commercial Permit: Runs AED 500–800 per month.
Malls: Most give you 2–4 hours free, but after that, it jumps to AED 10–20 per hour.
If your office or apartment comes with a parking spot, that’s a big plus. In places like Marina or Downtown, paid parking can add AED 200–400 to your monthly bills.
The Salik Toll System: The “Invisible” Cost
Dubai has an automated toll system called Salik. There are no booths. You just drive under a gate and AED 4 comes out of your account. There are eight gates on main roads like Sheikh Zayed Road, Al Barsha, and Business Bay.
- The Setup: You have to buy a Salik tag (sticker) for your windshield and keep money in the account.
- The Rules: Minimum top-up is AED 50. If your balance hits zero and you drive through a gate, you get slapped with a AED 50 fine.
- The Monthly Hit: If your daily commute takes you through just two gates, budget for AED 100–250 per month.
- Strategy: You can plan routes to avoid the main highways, like using Al Khail Road. But sometimes, saving time is worth the 4 dirhams.
Insurance: It’s Mandatory and It’s Getting Pricey
You can’t drive without insurance. UAE law requires at least third-party coverage. Premiums have gone up lately, mostly because of recent floods and higher repair costs. According to Shory’s 2025 analysis:
- Third-Party Only: Ranges from AED 450 to AED 1,000 annually.
- Comprehensive: This covers your car too, and it costs significantly more – AED 1,200 to AED 5,000+.
What Drives the Price?
Car Value: Insurers usually charge between 1.25% and 3.25% of what your car is worth. If you drive a luxury car (at least AED 300k), expect to pay around 2.75%.
Vehicle Type: A standard sedan might cost AED 1,200–1,600 to insure. An SUV is more like AED 1,800–2,700. A high-performance luxury car? AED 4,000–7,500.
Experience: If you are under 25 or have a new license, prepare for a shock. You could pay 3–7% of the car’s value because of the risk profile. New license holders often face a 25% surcharge.
History: If you drive safely and don’t make claims, you can earn a “No-Claim Bonus” of up to 30%.
How to Lower the Bill:
- Always compare quotes; never auto-renew.
- Increase your deductible if you trust your driving skills.
- Ask about “telematics” (devices that track your driving for discounts).
- Drop the extras like off-road cover if you never leave the pavement.
- If your car is older, stick to third-party coverage (policies start around AED 630).
Fuel: Filling the Tank
Fuel prices are regulated and change every month. In April 2025, Special 95 was about AED 2.46 and Super 98 was AED 2.57. Prices go up and down, but fuel is usually cheaper than in Europe.
How much you spend depends on your car.
- Compact Sedan: If you do about 1,500 km a month, expect to spend around AED 394.
- SUV: If you are driving a thirsty beast for 2,000 km, that bill jumps to nearly AED 787.
From my own experience with a mid-sized sedan, I set aside AED 350–600 a month for fuel. It changes depending on how much I use the AC and how bad the traffic is.
Saving Tips:
- Drive a hybrid or a smaller engine.
- Use apps like ENOC or EPPCO for rewards (you can get 5–10% back).
- Stop idling your engine and plan your errands to avoid rush hour.
Maintenance: Fighting the Elements
The desert is tough on cars. Heat kills batteries and tires, and sand gets everywhere. Maintenance isn’t just about keeping your car running. It also helps keep its resale value up.
Routine Stuff:
Oil Change: Every 10,000 km. Costs AED 80–800 depending on if you go to a cheap garage or the dealer.
Tires: Rotate them every 15,000 km (AED 50–100).
Brakes: Check them every 20,000 km (AED 100–200).
When Things Break:
Fixing a Corolla and fixing a Mercedes are two very different things.
Battery: AED 300 (Economy) vs. AED 1,500 (Luxury).
Brake Pads: AED 200 (Economy) vs. AED 1,200 (Luxury).
AC Repair: This is crucial. A compressor can cost AED 500 for a small car or AED 3,000 for a luxury one.
The Long-Term Budget
Most people spend AED 200–500 every six months on basics, with a major service costing AED 800–2,500 once a year. If you drive a high-end car out of warranty, you need to be ready for bills exceeding AED 8k–15k a year.
I recommend putting aside AED 800–1,500 each month for car costs. With all the dust, it’s smart to service your car every 5,000 km, just like most mechanics say.
Fines: The Price of breaking the Rules
Dubai doesn’t tolerate bad driving, and the fines are high.
- Speeding: If you go 20–30 km/h over the limit, it’s a AED 600 fine and a black point on your license.
- Parking: Taking a disabled spot without a permit? That is AED 1,000 and 6 black points.
- Registration: If you forget to renew, it’s AED 500 every month you are late.
Dubai has a Black Point system. If you get 24 points, your license is suspended. Fines can also make your insurance more expensive next year. It’s best to drive carefully.
Real World Examples: What Does a Year Cost?
To give you a clearer picture, here is how the annual costs (excluding car loan payments) stack up for three different types of drivers in 2025:
| Registration | AED 4,000 | AED 380 | AED 350 |
| Insurance | AED 12,000 | AED 7,500 | AED 1,200 (3rd Party) |
| Fuel | AED 10,170 | AED 5,000 | AED 4,300 |
| Maintenance | AED 15,000 | AED 8,000 | AED 3,000 |
| Salik Tolls | AED 2,000 | AED 2,000 | AED 2,000 |
| Parking | AED 6,000 | AED 4,000 | AED 3,000 |
| TOTAL ANNUAL | AED 49,170 | AED 26,880 | AED 13,850 |
A high-end coupe like a Mercedes S63 can cost over AED 51,000 a year to run. The gap between economy and luxury car costs is huge.
The Hidden Costs No One Tells You About
There are small things that eat into your budget:
- Salik tags: The initial tag is AED 100. If you need extras for family cars, you pay again.
- Car washes: You cannot drive a dirty car here. A wash is AED 30–50, and detailing is AED 200+. Because of the dust storms, you’ll be washing it constantly.
- Tinting: Essential for surviving the summer. Legal tinting (50%) costs AED 700–1,500.
- Extras: Dash cams, seat covers, and ceramic coatings all add up.
- Roadside assistance: Worth the AED 120/year for peace of mind.
- Extended warranty: Can cost AED 3,000–6,000, but it might save you a fortune later.
- Salik penalties: Forget to top up your account? That’s a AED 50 fine.
The Big Question: Buy, Lease, or Rent a Car?
Short Term (over 2 years): Renting is probably smarter. You avoid the headache of selling the car later, plus depreciation and maintenance aren’t your problem.
- Economy Rental: AED 1,200–1,800/month.
- SUV Rental: AED 2,500–3,500/month.
- Luxury Rental: AED 4,000–8,000+/month.
Leasing: A good middle ground. You get a new car every few years, and servicing/registration is usually included in one fixed monthly fee.
Buying: Best if you’re staying for the long term (3 years or more). The upfront costs sting, but once the loan is done, the car is yours and your monthly bills drop a lot.
Smart Strategies to Save Cash
Budget like a pro: Set aside that AED 800–1,500 monthly “car fund” for repairs.
- Go hybrid: They cost more to buy, but you save on fuel, and the regenerative braking saves your brake pads.
- Use apps: Find parking deals and fuel discounts.
- Drive safe: A clean record keeps insurance low and fines away.
- Shop around: Don’t be loyal to your insurance company; loyalty rarely pays.
- Buy used: Let someone else take the depreciation hit.
- Time your trips: Avoiding peak traffic saves fuel, Salik, and your sanity.
Frequently Asked Questions about Cost of Owning a Car in Dubai
How much does it really cost to register a car for the first time?
You are looking at between AED 420 and AED 900. It depends on if you need a new traffic file or want a fancy plate. The basics are: Registration (AED 420), Inspection (AED 170), File Creation (AED 220), and the Knowledge Fee (AED 20).
What is car insurance costing in 2026?
For third-party, expect AED 450–1,000. For comprehensive, it’s AED 1,200–5,000 (roughly 1.25%–3% of the car’s value). If you are young or a new driver, add a hefty surcharge of 25% or more.
How does Salik work?
It’s AED 4 – 6 every time you pass under a gate. You need a tag on your window and a minimum account balance of AED 50. If you hit zero, you get fined AED 50.
What is a realistic car fuel budget?
At current prices (~AED 2.46/liter), a typical commuter will spend AED 350–800 a month. If you drive a V8 SUV, double it.
What car fines should I watch out for?
Speeding (20–30 km/h over) is AED 600. Parking in a disabled spot is AED 1,000. Driving with expired registration is AED 500 per month.
Rent or Buy?
If you are here for less than two years, rent. It’s hassle-free. If you are staying longer, buying usually works out cheaper in the long run.
Final Thoughts
Owning a car in Dubai gives you freedom, but it’s a big financial commitment. Loan payments, insurance, Salik, fuel, and maintenance add up fast. A luxury SUV can cost AED 40,000–50,000 a year, while an economy car like a Corolla is closer to AED 14,000.
Pick a car that fits your budget, not just your taste. Stay on top of maintenance to avoid problems, drive safely to avoid fines, and check your insurance options every year. With some planning, you can enjoy driving in Dubai without breaking the bank.
