The study says finance costs on new cars have jumped 24% in 2019, pushing the average annual cost of vehicle ownership to $9,282, or $773.50 a month. That’s the highest cost associated with new vehicle ownership since AAA began tracking expenses in 1950.
“Finance costs accounted for more than 40% of the total increase in average vehicle ownership costs,” said John Nielsen, AAA’s managing director for Automotive Engineering & Repair. “AAA found finance charges rose more sharply in the last 12 months than any major expense associated with owning a vehicle.”
The big bump in finance charges comes from rising federal interest rates and higher vehicle prices.
The new figures come from Your Driving Costs, which reviews nine categories of vehicles-consisting of 45 models – to determine the average annual operating and ownerships costs of each. AAA focuses on top-selling, mid-priced models and compares them across six expense categories: fuel prices, maintenance/repair/tire costs; insurance rates; license/registration/taxes; depreciation; and finance charges. Annual average costs increased in each category.
Of all costs, depreciation, a measure of how quickly a car loses value, remains the single biggest cost of ownership, accounting for more than a third (36%) of the average annual cost.
Average fuel costs rose to 11.6 cents per mile, 5% higher than last year. Electricity prices for EV charging also rose 0.1 cent per kilowatt-hour (0.08%).
Average maintenance and repair costs climbed marginally to 8.94 cents per mile, up 8.9% over last year. The increase was fueled by the growing complexity of vehicle systems and an updated methodology for calculating repair costs.
The cost of licenses, registration fees and taxes rose $14 to $753 per year, an increase of 1.9%.