Most drivers can tell you what they paid for their car and maybe even what it costs to keep the gas tank full. But the true annual costs of new vehicle ownership are trickier to track.

That’s why AAA dives into the data every year to produce a comprehensive review of ownership costs across nine different categories of new vehicles. Here are the highlights from our latest study:

Overall, the average annual cost of new vehicle ownership climbed to $9,282, or $773.50 a month. That’s an increase of $433 – or nearly 5% – from last year. Drilling down further, AAA found that average costs increased in every expense category it analyzed:

• Fuel costs rose to 11.6 cents per mile, up about half a cent from last year.
• Maintenance, repair and tire costs climbed to 8.94 cents per mile, up 0.73 cents.
• Annual average insurance costs inched up to $1,194 per year, a $5 increase.
• Licensing, registration and taxes rose to $753 per year, up $14.

“A lot of these are costs that many drivers probably don’t think much about,” said John Nielsen, AAA’s managing director of Automotive Engineering & Repair. “But they really add up over time.”

Key Findings

Depreciation, a measure of how quickly a vehicle loses value, increased $45 to $3,334 per year, on average. While depreciation remains the single biggest cost of ownership, rates grew more slowly than last year – meaning vehicles held their value somewhat better.   

The steepest percentage increase this year came from finance costs.

Fueled by rising interest rates and higher new car prices, the annual average interest paid on a car loan climbed by $176, to $920 a year. That’s a 24% hike and accounts for more than 40% of the increase in total average annual new car ownership costs.

The sharp rise in annual average finance costs coincides with a trend among some car buyers to choose loans that last for 72, or even 84 months. While these long-term loans offer lower monthly payments, buyers ultimately pay more than if they’d chosen a loan of 48 or 60 months.

“We found that for every 12 months a loan is extended, the finance charges increase, on average, by almost $1,000,” Nielsen said. “And due to depreciation, buyers who opt for extended loans are usually ‘upside down’ on their loan – owing more than the vehicle is worth – for a longer time.”

Highs and Lows

Because fuel costs are a major factor in annual average driving costs, smaller, fuel-efficient vehicles are the least expensive to own and operate. Small sedans in the study enjoyed the lowest average annual ownership costs at $7,114. Hybrid cars were second at $7,736.

Half-ton pickup trucks were the most expensive vehicles in the study, with average annual ownership costs of $10,839. Large sedans were slightly less expensive at $10,403.

Here’s a full rundown of average annual new ownership costs by vehicle category (based on 15,000 miles driven annually):

The figures are part of AAA’s annual Your Driving Costs study. To find out how much you really pay to drive, download the 2019 Your Driving Costs brochure.

After a home purchase, buying a vehicle is usually a consumer’s second biggest expense. Research is key when choosing a new car, as is acting carefully and methodically. AAA.com/autobuying is a comprehensive resource that can help make the process more manageable. Here are some tips to keep in mind:

• Know what you can afford to spend before going to the dealership. Determine your budget and stick to it. Even better, arrange your financing ahead of time.
• Minimize finance costs by getting the shortest loan term you can afford.
• Seasonally, the best times to buy tend to be the last two weeks of December and, to a lesser extent, between July and October.
• Smart shoppers buy near the end of the month because sales managers like to build campaigns around monthly quotas. Shop toward the end of the month and you’re more likely to find a salesperson willing to deal.
• Consider a late-model, gently used vehicle. New cars lose about 20 percent of their value the moment they leave the lot, so you can save big if you look for a car that’s a year or two old. Your insurance costs will likely be less, too.
• If you belong to AAA or a similar organization, you may qualify for special discounts. Dealers sometimes agree to limit profits when selling to club members, though the deals may be limited to certain makes and models.

The annual cost of driving a new car may be rising, but AAA can help you pick a great car and get up to $500 cash back. Learn more about AAA's Bonusdrive program!

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