AAA Reports Vehicle Ownership Costs Constant Despite Lower Fuel Costs
by Steve Cypher on Wednesday, April 8th, 2009The latest report from AAA shows that motorists are spending on average 54 cents per mile to operate their vehicles even with the lower costs of gas and diesel fuel.
The price is not the cost
Here at Auto Credit Express, we continually point out to our customers that, when they decide to buy a car, other expenses, in addition to the monthly payment, have be taken into consideration in determining a vehicle’s ownership costs.
The price of a vehicle is your bottom line on the purchase order that you sign, while the cost of a vehicle also includes, among other things, its fuel economy, depreciation, and insurance costs. As a way of explaining these costs, we thought that visitors to autocreditexpress.com might find the following press release educational:
ORLANDO, Fla. – AAA’s 2009 edition of “Your Driving Costs” shows the average cost of owning and operating a new car in the U.S. has remained relatively unchanged despite lower fuel costs. The average cost for a new sedan driven 15,000 miles per year is 54 cents per mile, only 0.1 cent less than reported in 2008.
“While motorists are experiencing relief at the pump, those savings have been countered by revised Environmental Protection Agency fuel economy estimates and increases in vehicle ownership costs such as insurance premiums, depreciation, finance charges and other fees and taxes,” said AAA Automotive Vice President Marshall L. Doney.
New sedan costs average $8,095 yearly
AAA estimates the cost to own and operate a typical new sedan driven 15,000 miles yearly is $8,095, only $26 less than last year’s estimated cost of $8,121. Small sedan costs were unchanged at 42.1 cents per mile, or $6,312 annually. Medium sedan costs dropped 1.1 cents per mile to 54.0, or $8,105 per year, thanks to maintenance cost savings and lower depreciation. However the costs for large sedans rose 0.7 cents per mile to 65.8, or $9,870 yearly, due largely to increased depreciation.
SUV costs drop, minivan’s jump
SUV owners, whose vehicles get lower fuel economy, benefited most from the drop in fuel prices. Their estimated operating costs dipped 1.3 cents per mile to 68.4 cents, or $10,259 per year, despite a relatively large increase in depreciation and insurance premiums. Meanwhile, minivan costs jumped 1.2 cents per mile to 58.8 cents, or $8,815 yearly. The growth is due to cost increases in every area except fuel and included the largest rise in depreciation of any vehicle class.
New EPA baselines provide better “real world” results
AAA’s 2009 edition of “Your Driving Costs” uses the U.S. Environmental Protection Agency’s revised fuel-economy estimates that are intended to better reflect “real world” results.
“AAA was a strong advocate for updating the EPA’s guidelines for calculating fuel economy so new car buyers could have a realistic estimate of a vehicle’s miles per gallon before their purchase,” Doney said. “The ability to use EPA estimates more closely based on ‘real world’ conditions in our calculations has made ‘Your Driving Costs’ an even more valuable tool for consumers.”
Understanding the calculations
AAA’s calculations are based on both operating and ownership costs that include:
Operating Costs: Fuel, Maintenance and Tires
Ownership Costs: Insurance, License, Registration, Taxes, Depreciation and Financing
The costs are based on typical use of a vehicle for personal transportation over five years and 75,000 miles of ownership. Fuel costs were based on $2.30 per gallon, as reported by the AAA Fuel Gauge Report (AAAFuelGaugeReport.com) in late 2008.
AAA’s analysis covers vehicles equipped with standard and optional equipment. The driving costs in each category are based on the average expenses for five top-selling models selected by AAA. The models included in the study are:
Small Sedans: Chevrolet Cobalt, Ford Focus, Honda Civic, Nissan Sentra and Toyota Corolla
Medium Sedans: Chevrolet Impala, Ford Fusion, Honda Accord, Nissan Altima and Toyota Camry
Large Sedans: Buick Lucerne, Chrysler 300, Ford Taurus, Nissan Maxima and Toyota Avalon
SUVs: Chevrolet Trailblazer, Ford Explorer, Jeep Grand Cherokee, Nissan Pathfinder and Toyota 4Runner
Minivans: Chevrolet Uplander, Dodge Grand Caravan, Kia Sedona, Honda Odyssey and Toyota Sienna
“Your Driving Costs” availability
A hard copy of the “Your Driving Costs” brochure is available upon request, and subject to availability, from local AAA clubs. The brochure also can be downloaded free of charge from the AAA Exchange at AAA.com/publicaffairs.
The Bottom Line
Our thanks to AAA for making this information available.
