Average Cost of Owning and Operating an Automobile (2024)

FAQs

Average Cost of Owning and Operating an Automobile? ›

Question: The average cost of owning and operating an automobile is $8121 per 15,000 miles including fixed and variable costs. A random survey of 40 automobile owners revealed an average cost of $8350 with a population standard deviation of $750.

Owning a car costs an average of $10,728 per year or $894 per month. The cost of owning and maintaining increased by 10% from 2021 and crossed the 10K mark in 2022. The costs of owning a car go beyond the purchase price.

When you take into account loan interest, depreciation, fuel, insurance, maintenance and fees, the cost of owning a car makes a big leap. For new vehicles driven 15,000 miles a year, average car ownership costs were $12,182 a year, or $1,015 a month, in 2023, according to AAA.

The total cost of owning and operating an automobile include fuel, Maintenance, Tires, insurance, license, registration and taxes, depreciation, and finance.

Repairs and Maintenance

If your car doesn't have a warranty, unexpected major repairs can cost thousands of dollars plus the cost of towing it to a mechanic. Even if your car has a warranty, you will be responsible for the cost of repairs when the warranty expires.

Owning costs = purchase price of machine + financing + taxes – disposal price (what you get for that machine when you resell it). Operating costs = labor + fuel + maintenance + replacement costs of tires, tracks and other components + overhead. Add the owning to the operating costs and you have your O&O costs.

In California, it costs $4,796 to own a car, which is 3% lower than the national average, according to the study. The average cost of car insurance in the Golden State is $1,357.

In addition to the cost of acquisition, there's maintenance, insurance, and the average gas cost per year. We all know that those costs add up, but few of us know exactly how much it really costs to own a car.

It depends a bit on what you mean by “actually cost”. On average, the raw materials that physically go into the car are about 47%, and the direct labor to build the car is about 21% of the car's value . So in a sense, you could say that the physical cost to manufacture a $50,000 car is about $34,000. About $17,000.

With the average price of a new car hitting $47,936 in October 2023, chances are you'll need to take out an auto loan to cover some or most of the cost. Based on LendingTree's auto debt statistics, the average car loan was $40,851 for the first quarter of 2023, with an average monthly payment of $725.

What is the average cost per mile to own and operate a car? ›

2022 Year-in-Review

On average, it costs $0.72 per mile to operate and maintain a new vehicle in 2022, assuming the owner drives it 15,000 miles per year. The per-mile cost of owning an automobile has remained the same since 2020 – at $0.44 per mile.

Operating costs are the expenses incurred by a business that it uses to conduct its operations. These expenses may include payroll, rent, insurance premiums, utilities, and equipment maintenance. Operating costs do not include capital expenditures or depreciation.

Multiple Costing

This type of method is used where the product is produced separately. This method is suitable for manufacturing radios, airplanes, automobiles engines, cycles, etc.

Average monthly cost of owning a car

Based on AAA's data, the average monthly cost of owning and operating a car is $894. The organization used six categories of cost to determine their average: fuel, maintenance/repair/tire costs, insurance, license/registration/taxes, depreciation and finance charges.

Loan Interest Payments

More costs of owning a vehicle are depreciation, fuel costs, and insurance premiums.

In 2016, owning and operating an average sedan costs $8,558 per year, which is equal to $713 per month or 57 cents per mile. If these numbers shock you, then consider that they represent a six-year low and a 1.6 percent drop compared to 2015 – mainly because of lower gasoline prices.

These extra costs include: depreciation, interest on your loan, taxes and fees, insurance premiums, fuel costs, maintenance, and repairs.

For a car that sells for $5,000, the manufacturer can make about $2,500 in profits, leaving the cost of manufacturing at about $12,500. Porsche – Most Porsche cars sell for between $50,000 and $150,000.