There are more expenses to owning a new car aside from making a monthly payment. You have gas, maintenance, repairs, and depreciation to worry about. The total cost according to a new study from AAA will depend on the type of vehicle you're driving.
AAA's Your Driving Costs study reports that average cost to own and operate a new vehicle in 2017 is $8,469 per year - $706 per month. The study looked at 45 new vehicles from the 2017 model year and evaluated the various costs such as gas and maintenance, but not insurance and monthly payment. When broken down into individual segments, small sedans are the cheapest ($6,354 annually) and trucks are the most expensive ($10,054).
This year's Your Driving Costs study saw hybrid and electric vehicles being separated for the first time. EV's are just under the average with an annual cost of $8,439, But EVs have horrendous depreciation - losing $5,704 on average per year.
“Although electric vehicles can have higher up-front costs, lower fuel and maintenance costs make them a surprisingly affordable choice in the long run. For even lower costs, car shoppers can avoid high depreciation costs by selecting a used electric vehicle,” said John Nielsen, AAA’s managing director of Automotive Engineering and Repair in a statement.
Press Release is on Page 2
AAA Reveals True Cost of Vehicle Ownership
- Average new vehicle will cost nearly $8,500 annually to own and operate
Owning and operating a new vehicle in 2017 will cost a driver an average of $8,469 annually, or $706 each month, according to a new study from AAA. The annual evaluation of driving costs reveals that small sedans are the least expensive vehicles to drive at $6,354 annually, however small SUVs ($7,606), hybrids ($7,687) and electric vehicles ($8,439) all offer lower-than-average driving costs to U.S. drivers. Conversely, of the nine categories included in the evaluation, pickup trucks are the most expensive vehicles to drive at $10,054 annually.
“Determining the cost of a new vehicle car is more than calculating a monthly payment,” cautioned John Nielsen, AAA’s managing director of Automotive Engineering and Repair. “While sales price is certainly a factor, depreciation, maintenance, repair and fuel costs should be equally important considerations for anyone in the market for a new vehicle.”
In addition to analyzing the ownership costs for sedans, SUVs and minivans, AAA’s Your Driving Costs study added four new vehicle segments in 2017 – small SUVs, pickup trucks, hybrids and electric vehicles.
Vehicle Type Annual Cost*
- Small Sedan: $6,354
- Small SUV: $7,606
- Hybrid: $7,687
- Medium Sedan: $8,171
- Electric Vehicle: $8,439
- Large Sedan: $9,399
- Medium SUV: $9,451
- Pickup Truck: $10,054
- Average: $8,469
*Based on 15,000 miles driven annually
To estimate the overall cost to own and operate a new vehicle, AAA evaluated 45 2017 model-year vehicles across nine categories and focused on mid-range, top-selling vehicles. AAA’s annual driving cost is based on a sales-weighted average of the individual costs for all of the vehicle types. Key findings include:
Depreciation — the declining value of a vehicle over time — is the biggest, and most often overlooked, expense associated with purchasing a new car. New vehicles lose an average of $15,000 in value during the first five years of ownership. In 2017, small sedans ($2,114) and small SUVs ($2,840) have the lowest annual depreciation costs, while minivans ($3,839) and electric vehicles ($5,704) are at the high end of the scale.
Maintenance and repair
To calculate annual maintenance and repair costs, AAA examined factory-recommended maintenance, replacement tires, extended warranty costs and services associated with typical wear-and-tear. New vehicles, on average, will cost a driver $1,186 per year to maintain and repair.
The inevitable costs associated with maintenance and repair should be an important consideration for car shoppers, as a recent AAA survey found that one-third of U.S. drivers could not afford an unexpected repair bill. AAA Approved Auto Repair facilities offer free vehicle inspections, AAA member discounts and a 24-month/24,000-mile warranty for AAA members. Visit AAA.com/AutoRepair to find a nearby facility.
Fuel costs vary significantly by vehicle type, ranging from 3.68 cents per mile (electric vehicles) to 13.88 cents per mile (pickup trucks). New vehicle owners, on average, will spend just over 10 cents per mile – about $1,500 annually — to fuel their vehicles.
For gasoline-powered vehicles, AAA recommends selecting a TOP TIER gasoline, as its independent research found it to keep engines 19 times cleaner, improving vehicle performance and fuel economy. AAA cautions drivers that using premium-grade gasoline in a vehicle that does not specifically require it is an unnecessary expense.
New to the Your Driving Costs study in 2017, AAA found that electric vehicles have lower-than-average driving costs at $8,439 per year. Without a gasoline engine to maintain, electric vehicles have the lowest annual maintenance and repair costs, at $982 per year. By relying on electricity instead of gasoline, fuel costs are also significantly lower than average, at under four cents per mile. Depreciation, however, is currently extremely high for these vehicles, losing an average of nearly $6,000 in value every year.
A recent AAA survey revealed that 1-in-6 Americans are likely to choose an electric vehicle, the majority motivated by their lower long-term ownership costs.
“Although electric vehicles can have higher up-front costs, lower fuel and maintenance costs make them a surprisingly affordable choice in the long run,” said Nielsen. “For even lower costs, car shoppers can avoid high depreciation costs by selecting a used electric vehicle.”