Dec 2022
4 mins read

7 Things to Consider When Choosing Between a Car and a Cab

Buying a car is always a momentous occasion. It is arguably the single most expensive purchase you may make, other than buying your house. It calls for a thorough evaluation of your finances and careful planning. But now, with the growing popularity and convenience of ride-hailing apps, the question arises - do you still need to buy a car, or could you just rent a cab wherever you need to go? We dive into the pros and cons of each decision:

Up-front cost

An entry-level family car may cost anywhere from Rs. 4-6 lakh, while a 10 km cab ride may cost only around Rs. 200¹. If your usage is limited, the high up-front cost of purchasing a car can be prohibitive, and you might prefer to stick to cabs instead.

point 1


Car insurance is mandatory in India. It has to be purchased with the car and then typically renewed annually, making it an ongoing expense. Switching to cabs will help you save on this expense.

point 2

Running costs

A cab may cost anywhere between Rs. 25-50 per km, while petrol for an entry-level family car will cost you ~Rs. 7-8 per km in the city (assuming fuel economy of 15km/litre at a fuel price of Rs. 110 per litre²). The difference can be substantial and becomes even more significant for frequent travellers.

point 3

Maintenance costs

As a car-owner, you are responsible for annual maintenance costs as well as one-off repair costs for your car. Routine maintenance for a budget car would cost Rs. 10-20,000 per year depending on its age and condition.

point 4

Comfort vs. control

In congested cities, renting a cab lets you kick back and relax, instead of fretting about traffic. On the other hand, some people like the sense of ownership in having their own car, and being able to customise it for greater comfort than a cab might offer.

point 5

Frequency and type of usage

If you travel regularly, having your own car may turn out to be a cheaper option in the long run than renting cabs. On the other hand, a personal vehicle could be useful if you carry a lot of things around with you when you travel.

point 6


Not every city has convenient cab services - larger cities are better-served than smaller ones. If you live in a smaller town, you may have no option but to buy a car.

point 7

Becoming a car-owner is a wonderful achievement, but before you take the leap, evaluate your finances, likely usage and personal preferences. You may even find that renting a cab regularly is a better option. Ultimately, there is no ‘right’ answer – it’s up to you.

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