Sticker Shock: Owning a New Vehicle Costs Nearly $10,000 Annually
According to the latest research from AAA, the average annual cost of new vehicle ownership is $9,666, or $805.50 per month. The biggest factor pushing the nearly $10,000 annual price tag is depreciation. It accounts for 40 percent of all ownership expenses outpacing additional costs like fuel and maintenance. With low inventory at dealerships due to the semi-conductor chip shortage, AAA urges new car buyers to be aware of all the expenses associated with ownership so that they can negotiate the best deal for their budget.
The 2021 AAA Your Driving Cost study reviewed nine categories of vehicles – consisting of 45 models – to determine the average annual operating and ownership costs of each. AAA selects top-selling, mid-priced models and compares them across six expense categories: fuel, maintenance/repair/tire costs, insurance, license/registration/taxes, depreciation, and finance charges. Depreciation – a measure of how quickly a car loses value – remains the single biggest cost of new vehicle ownership. Other key findings of this year’s Your Driving Costs include:
- Fuel Costs: Based on data from May 2020 - May 2021, on average, fuel costs 10.72 cents per mile. This does not include recent spikes in gas prices. Fuel costs vary widely by vehicle type, ranging from a low of 3.66 cents per mile for electric vehicles to 15.81 cents per mile for pickup trucks.
- Maintenance, repair, and tire costs: On average, maintenance and repair cost 9.55 cents per mile. Just like fuel, electric vehicles are on the lower end of the spectrum, costing 7.70 cents per mile, while medium sedans are the most expensive at 10.43 cents per mile.
- Finance charges: The cost of vehicle loans decreased due to a drop in the prime lending rate. The average interest rate in 2021 is 4.12 percent, which is 1.056 percentage points lower than last year.
For more information on the AAA Your Driving Costs study, go to https://www.southpa.aaa.com/automotive/your-driving-costs-2021.
