Study: Average Annual Vehicle Ownership Cost Increases

As the nation continues to face high sticker prices, a recent study by the American Automobile Association (AAA) showed that the average cost of owning a vehicle per year has increased. To accurately perform this study, AAA assessed nine vehicle categories. All of which include small sedan, medium sedan, subcompact SUV, compact SUV, medium SUV, mid-size pickup, half-ton pickup, hybrid vehicle, and electric car. Among these categories, every operating and ownership cost was computed to achieve the average annual vehicle ownership cost in the U.S.

What costs are considered?

AAA’s research took into account a number of factors to determine the average annual vehicle ownership cost. The non-profit could not properly perform this study without considering the daily, monthly, and even yearly expenses of car ownership. The list of components include:

• depreciation
• fuel
• insurance
• license and registration
• auto loan
• maintenance and repairs

Equally important, the research took into account both standard and additional features. The add-on features are the ones you typically see on higher trim levels. This includes anything from anti-lock brakes and cruise control to everyday basics like air conditioning. By analyzing every aspect of car ownership, the American Automobile Association was able to deliver compelling results.

Continue reading to find out the exact annual average of owning a vehicle in 2021.

What is the average vehicle ownership cost in the United States?

According to the study, the total cost for a vehicle driven 10k miles a year is $8,307. Comparatively, the total cost for a car driven 15k miles a year is $9,666. These averages seem outlandish at first glance. I mean can you even imagine spending close to $10,000 of your take-home pay on your car? The results are a reminder that drivers spend way more on their vehicle than actually presumed. One month you might be in need of new tires. By the next you could be replacing a passenger door from a crash. Even basic detailing, such as car washes take a chunk out of your wallet. The point being — the expenses pile up quickly, especially as your car gets older.

That being said, there are all types of drivers on the road. You have the 9 to 5er with a consistent commute. The leisure driver hoping around town. Then there’s the one with the need for speed. Basically, the way you use and abuse your ride will also factor into the average cost of ownership. It’s the first way to tell if your car will withstand the test of time and how much it might cost you per year to own that specific vehicle.

Calculate your annual vehicle ownership cost

The yearly report gives drivers general insight of how costly vehicle ownership is in 2021. Thanks to AAA’s study, drivers have a better idea of what to expect when getting into a new or used vehicle. All things considered, we know every car is different. To detail, a Hyundai sedan will have less expensive repairs than a BMW SUV. Additionally, you’ll have higher insurance rates for a sports car versus a compact sedan. These factors influence what your average annual vehicle ownership cost would be.

Luckily, AAA provides a calculation guide that allows drivers to configure their own costs. Not only is this tool easy to use, it permits drivers to examine their operating costs from a yearly outlook. Beyond that, it’s helpful to those who have a vested interest in their car. For the ones that want to keep their ride for a long as possible without getting in too deep financially. 

Summing up your yearly expenses is an opportunity to see if your vehicle is more of a burden rather than a luxury. Despite how grand your love affair might be with your vehicle, owning that car could be costing you hundreds or even thousands of dollars each month. That’s cutting directly into your weekly paycheck (big time). 

Final thoughts

Between pesky repairs and regular maintenance, you could find yourself in a financial bind every few months. If this scenario sounds all too familiar, it might be time to part ways with your ride. There is no guarantee any vehicle will be stress-free. Some even say it comes down to luck. But, if your current ride is costing you more than you’d like, it’s time to make a change. Try listing it on Carvana or selling it to a local dealer. Then, move on to your next purchase. Preferably, something with less of an annual vehicle ownership cost.