Whether you need to own a car depends mostly on how far and how often you drive. Owning comes with large fixed costs that you pay even when the car sits in the driveway: depreciation, insurance, registration and often parking. Car sharing and rentals charge only when you use a car, at a higher price per trip. So the fewer kilometres you drive, the more likely it is that renting, car sharing or a mix of transit and occasional rentals costs less than owning. This page covers those no-car options and where the break-even falls. It’s part of our guide to buying a car in Canada.
The options without owning a car
| Option | How you pay | Tends to suit |
|---|---|---|
| Round-trip car sharing | A membership or plan fee, then a charge by the hour or day plus a charge per kilometre; fuel and insurance are included | Errands and short trips in a city, booked ahead |
| One-way (free-floating) car sharing | A charge by the minute, hour or day; you pick up and leave the car anywhere inside a service area | Short one-way trips inside the service area |
| Peer-to-peer rental | A daily price set by the car’s owner, plus the platform’s fees and protection plan | Day trips and weekends where a choice of vehicle matters |
| Traditional rental | A daily or weekly rate, plus taxes, fees and any damage waiver you buy | Long trips, holidays and moves |
| Car subscription | A monthly fee that bundles the car, insurance and maintenance, usually with a kilometre allowance | Several months of driving without a loan or lease |
| Transit, taxis and ride-hailing | Per trip | Daily commuting where transit is good |
Round-trip car sharing is run by operators such as Communauto in several Canadian cities, and by Modo in British Columbia; one-way car sharing is offered by services such as Evo in Vancouver. Service areas, plans and prices differ by city and change often, so the operator’s own rate page is the place to check current pricing.
What owning costs even when the car is parked
The cost of a car splits into two kinds:
- Fixed costs, paid whether you drive or not: depreciation (or lease payments), insurance, registration and licensing, parking and the loan’s interest.
- Running costs, which rise with each kilometre: fuel or charging, maintenance, tires and wear.
For someone who drives little, the fixed costs dominate, which is what makes renting and car sharing competitive. The yearly figures for each item, by city, are in the cost of owning a car in Canada. If you do decide to own, the choices that set most of the fixed cost are covered elsewhere: whether to lease or buy is compared in leasing vs buying a car, and how much buying a few years old cuts depreciation in new vs used cars.
The break-even by kilometres
The break-even is the distance a year at which owning and car sharing cost the same. Owning costs its fixed amount plus a running cost per kilometre; car sharing costs an all-in amount per kilometre once its hourly charges are spread over the distance driven. Owning pays off beyond:
break-even kilometres per year = fixed cost of owning ÷ (car sharing cost per km − owner’s running cost per km)
| Input | Example |
|---|---|
| Owner’s fixed costs per year (depreciation, insurance, registration, parking) | $7,000 |
| Owner’s running cost per km (fuel and maintenance) | $0.20 |
| Car sharing cost per km, with time charges spread over the distance | $0.70 |
| Break-even distance | 14,000 km a year |
Below about 14,000 km a year in this example, car sharing costs less than owning; beyond it, owning does. At half the break-even distance, car sharing saves $3,500 a year.
Your own break-even moves with three things:
- Your fixed costs. A paid parking spot or a high insurance premium raises the fixed cost and pushes the break-even distance up. An older, paid-off car with low depreciation pulls it down.
- How you drive. Car sharing’s time charges make long, slow trips expensive per kilometre and short, quick ones cheap. Someone whose driving is mostly short errands sees a lower cost per kilometre than someone who books a car for a full day.
- What you’d use instead. Many people without a car combine transit for daily trips, car sharing for errands and a traditional rental for long trips, so the useful comparison is the whole mix against the full cost of owning.
Rentals for longer trips
For a weekend away or a long drive, a traditional rental’s daily or weekly rate usually works out lower than car sharing’s hourly and per-kilometre charges. Before booking, check:
- What the rate includes: the kilometre allowance (some rentals cap daily kilometres), taxes and airport or location fees, and the charge for an additional driver.
- Damage coverage: whether to buy the rental company’s collision or loss damage waiver, or rely on a credit card’s rental car benefit. Card benefits usually apply only when the whole rental is charged to that card and the rental company’s waiver is declined, and they exclude some vehicle types and long rentals; the card’s insurance certificate lists the conditions.
- Liability coverage: people who don’t own a car often have no personal auto policy, so the liability coverage that comes with the rental, and any supplemental coverage offered at the counter, is what protects them.
Costs that are easy to miss
| Without a car | With a car |
|---|---|
| Car sharing membership or plan fees | Parking at home and at work |
| Per-kilometre charges beyond any included distance | Winter tires and their storage |
| Late-return, cleaning and damage-deductible charges | Repairs once the warranty ends |
| Cars not being available at busy times | Depreciation, which never shows up as a bill |
Which tends to suit whom
Renting, car sharing or a mix tends to suit people who live where transit, walking or cycling covers daily trips, drive well under their break-even distance, and pay a lot for parking.
Owning tends to suit people who drive every day or far beyond the break-even, live where car sharing doesn’t operate, need a car at short notice (for work or children), or carry equipment that won’t fit a shared car.
Once you know which side of the break-even you’re on, how much to spend on a car sets out the budgeting rules of thumb if owning wins.