A new report from AAA’s Your Driving Costs has found that owning and operating a new vehicle costs more than $12,000 a year.
The sharp increase comes from higher car prices and financing rates, the driving club said. In 2022, the average monthly cost was only $894 per month, or $10,728 per year.
“It’s important for car buyers to clearly understand the costs associated with owning a new vehicle,” said Greg Brannon, AAA’s director of automotive research. “Due to global supply chain issues and constrained inventory of new vehicles, car prices rose dramatically in 2022. And while the situation continues to improve, the spillover effects are keeping prices high.”
Overall average manufacturer’s suggested retail prices on new vehicles were nearly 5 percent higher than last year at $34,876. Additionally, the higher sticker prices impact finance costs, the club said, with new car owners seeing a 90 percent increase in finance charges this year at around $1,253.
The club said other factors driving costs up include changes in depreciation, changes in the different between new vehicle prices and used vehicle prices and automakers focusing on producing more oversized, luxurious and expensive vehicles that increase prices further.
However, the club said, the average cost per mile has decreased by about 2 cents per miles. The cost of charging Electric vehicles (EVs) has risen about 2 cents per kWh over the last year, the club said, from 13.9 cents per kWh to 15.8 cents. The increase is likely due to higher-than-expected inflation, according to the U.S. Energy Information Administration.