AAA Reports Vehicle Ownership Costs Rise Nearly 5 Percent
by Steve Cypher on Monday, May 31st, 2010The latest report from AAA shows that motorists are spending on average nearly 57 cents per mile which is something to consider when taking out a bad credit car loan.
How to get back in the game
Bad credit auto loan web sites such as www.autocreditexpress.com can help you if you’re serious about reestablishing your auto credit. By filling out an online car loans with bad credit loan application you can begin a new chapter in your life by getting approved at one of our affiliate dealers for a second chance auto loan. Along with paying the rest of your obligations on time, you will then be able to raise your FICO scores and re-establish your car credit.
But the process can be an expensive one – especially if you choose the wrong kind of loan or the wrong kind of vehicle. Choosing the wrong kind of loan from a Tote the Note, We Finance Everyone car dealer can be a problem because these dealers don’t report your payment history to the credit bureaus.
On the other hand, a vehicle that’s too expensive can stretch your budget and, in some cases, result in repossession. Once this happens, rebuilding your car credit has to be put on hold for at least a year, since most bad credit auto loan lenders will only consider applicants with a repossession that’s more than a year old.
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 excerpts from the following press release educational:
ORLANDO, Fla. — AAA released the 2010 edition of its annual “Your Driving Costs” study, revealing the average cost to own and operate a sedan has risen 4.8 percent to 56.6 cents per mile, or $8,487 per year, based on 15,000 miles of annual driving.
“Rising fuel prices are a key factor in this year’s ‘Your Driving Costs’ study. Paying more at the pump is not only increasing the operational costs of vehicles, but it’s also affecting depreciation values,” said John Nielsen, director, AAA Auto Repair and Buying. “With the growing appeal of more fuel-efficient vehicles, small sedans are experiencing less depreciation and holding their value longer while we’re seeing notable rises in depreciation costs with categories of less fuel-efficient vehicles.”
New sedan costs average $8,487 yearly
AAA estimates the cost to own and operate a typical new sedan driven 15,000 miles yearly is $8,487, $392 more than last year’s estimated cost of $8,095. Small sedan costs were up 1.2 cents per mile at 43.3 cents per mile, or $6,496 annually. Medium sedan costs were up 2.2 cents per mile to 56.2, or $8,436 per year, due, as it was mentioned earlier, to rising fuel prices and the costs for large sedans rose even more, 4.4 cents per mile to 70.2, or $10,530 yearly due to rises in depreciation.
SUV, large sedan and minivan depreciation increases
SUV owners experienced the largest increases in depreciation, 10.7 percent. Large sedan depreciation jumped 6.1 percent while minivan depreciation increased 4.6 percent.
Rising fuel, tire and insurance costs contribute to increase in overall costs
Increases in the costs of fuel, tires and insurance were the primary factors causing a rise in all categories of vehicles. At the time of the “Your Driving Costs” calculations, the AAA Fuel Gauge Report listed the national average cost of regular unleaded gas as $2.603 per gallon, 12.7 percent higher than the cost of fuel in last year’s study.
The average costs of full coverage insurance on sedans also rose 5.7 percent over last year, while tire costs increased an average of 8.7 percent.
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
Vehicles studied
To conduct its study, AAA compiled detailed driving costs for small, medium, and large sedans. Driving costs in each category are based on the average costs for five top-selling models selected by AAA. By size category, they are:
Small Sedan – Chevrolet Cobalt, Ford Focus, Honda Civic, Nissan Sentra and Toyota Corolla.
Medium Sedan – Chevrolet Impala, Ford Fusion, Honda Accord, Nissan Altima and Toyota Camry.
Large Sedan – Buick Lucerne, Chrysler 300, Ford Taurus, Nissan Maxima and Toyota Avalon.Kia Sedona, Honda Odyssey and Toyota Sienna
As we see it
If you are serious about reestablishing your car credit buying a car that you can’t afford will not help you. Instead, we suggest visiting www.autocreditexpress.com and using our resources section to determine how much car you can afford. Through our affiliate dealers, we have helped thousands of people with bad credit get a new or reliable low mileage used car. More importantly, the car loans with bad credit that finance these vehicles have started these people “on the road” to renewing their auto credit and establishing a good credit history.
Fill out an application in the comfort and privacy of your home
So why not begin the process right now by filling out our secure online bad credit car loan application to see what we can do for you.
Tags: aaa, auto credit, Bad Credit, bad credit auto loan, bad credit car loan, car credit, car loans with bad credit, credit, fico, FICO score, repossession, tote the note, we finance everyone
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The research done is comprehensive. This is the right time to reestablish you auto credit, as the economy is recovering slowly. Thanks autocreditexpress.com for including such fantastic features for credit recovery plan.
The problem seems to be that so many people don’t study the policies, but also unfortunately insurance company’s try to find loopholes which shouldn’t occur. Just another reminder to not only shop for price, but also the coverage that you are paying for..
thanks for your blog:)