Average Cost to Own a New Vehicle Tops $10K Per Year

High gas prices, advanced tech, higher labor costs make ownership more expensive

BOISE – If you’re in the market for a new vehicle, you’ll need to set aside some extra money this year.  According to AAA’s annual report, Your Driving Costs, the average cost to own and operate a new car in 2022 is $10,728, a more than $1,000 increase from a year ago.

AAA used five top-selling models in each of nine vehicle categories to calculate ownership costs:

“Depreciation is the biggest cost associated with getting a new vehicle, and it kicks in the second you leave the lot.  But the total cost of ownership far exceeds the sticker price,” says AAA Idaho public affairs director Matthew Conde.  “Without knowing the whole story, owning and operating a new car could gobble up a big chunk of the family budget and really put a strain on your finances.”

High gas prices, rising labor costs, and vehicle systems that are more expensive to inspect, repair and replace are contributing to the higher cost of vehicle ownership.

As in previous years, small sedans are the least expensive to own and maintain at just under 55 cents per mile, which make them attractive for first-time buyers.  But the high cost of collision repairs on a smaller vehicle means they are more likely to be “totaled” by insurance companies due to crash damage.  At 86 cents per mile, the most expensive vehicles to own and operate are half-ton pickups, followed by medium SUVs (75 cents) and mid-size trucks (70 cents).

Electric vehicles charging ahead

At 60 cents per mile, EVs have the second lowest driving cost of the vehicle categories that were studied this year, ranking higher than in previous years due to being largely insulated from the sharp increase in gas prices that affected other categories.  Electric vehicles also have simplified powertrains that are less expensive to repair and maintain.

But EVs have the highest depreciation costs, and despite a network of more than 57,000 charging stations, the infrastructure is not nearly as developed as that of conventional fuels.

“EV technology is getting better all the time, and ‘range anxiety’ and concerns about a lack of charging stations are starting to fade from view,” Conde said.  “But as always, people should do their homework to find the vehicle that is right for them.”

AAA announces new Your Driving Costs calculator

New this year, AAA has launched an online Your Driving Costs calculator to provide a more interactive and personalized breakdown for car shoppers.  Using the same methodology as AAA’s annual report, potential vehicle owners can instantly conduct research on new and used vehicles, with several customizable fields that include state-specific results.

Drivers can also use the AAA Car Guide to learn more about the latest automotive technology.

What to know before you buy

Before you take on the expense of a new vehicle purchase, keep these tips in mind:

  • Start early. Due to limited inventory, finding the vehicle you want could take time.  You may have to wait for delivery or even pre-order your dream car.
  • Get pre-approval from your financial institution before discussing financing with the dealer. You’ll have a better idea of what your budget looks like, and you may be able to use pre-approval to negotiate if the dealer offers a higher lending rate.
  • Consider the total cost of ownership – upgrading your ride may come with more-expensive fuel, a higher price for routine maintenance, and higher insurance premiums. If you finance your vehicle, you may be required to carry comprehensive insurance coverage to satisfy the terms of the loan.
  • Check your current vehicle’s trade-in value. If you aren’t satisfied with the dealer’s offer, you may benefit from selling your current vehicle privately.

 

“AAA has been sharing Your Driving Costs information since 1950,” Conde said.  “We’re excited to put this new online tool in Idahoans’ hands to give them an even better idea of what it will cost to own a new car.”