Rising new car ownership cost Trends in 2026
Owning and operating a new vehicle has become significantly more expensive, with the average new car ownership cost now exceeding $12,000 annually. According to a recent analysis released by the American Automobile Association (AAA), the average cost to own and drive a new car this year reached $12,863 annually, or $1,071.92 per month. This represents an approximate 33% increase over a five-year period compared to 2021, when the annual cost stood at $9,666. Last year’s survey recorded an annual cost of $11,577, or $964.78 monthly.
AAA calculates these average ownership expenses by estimating fuel, maintenance, repair, and tax costs over the first five years of vehicle ownership, assuming 75,000 miles of driving.
Key Drivers Behind Higher Vehicle Expenses
Several major factors are fueling the surge in vehicle maintenance and purchasing burdens. Gasoline prices averaged $4.15 per gallon nationally during the survey period, marking a 31.8% increase from the previous year. California drivers faced an even greater burden, with gas prices hitting approximately $5.63. Conversely, home electric vehicle charging costs rose just 7.8% to an average of 18 cents per kilowatt-hour.
Higher sticker prices also play a major role, as the sales-weighted average Manufacturer’s Suggested Retail Price (MSRP) for new vehicles reached $39,376. Higher purchase prices naturally amplify auto financing costs.
However, depreciation remains the single largest expense category. Depreciationโthe difference between the purchase price and the vehicle’s future resale valueโaverages $4,422 annually.
Powertrain and Vehicle Class Differences
Ownership expenses vary noticeably by powertrain, including electric vehicles (EVs), gas cars, and hybrids (HEVs). While EVs offer significant fuel savings, higher depreciation, taxes, fees, and financing costs offset those savings, making annual EV ownership generally more expensive than gas-powered alternatives.
Vehicle class also dictates significant cost differences. Pickup trucks cost $1.10 per mile to operate, which is 48 cents higher than subcompact sedans, translating to an average of $7,191 more per year. For midsize electric sedans, annual ownership costs reached $13,662โabout $3,080 higher than internal combustion engine midsize sedans at $10,582.
Meanwhile, hybrids proved to be among the most cost-effective powertrains, combining fuel savings with lower depreciation impacts amid rising demand. AAA advises consumers to look beyond monthly loan payments and fuel economy to evaluate total ownership costsโincluding depreciation, financing, taxes, fees, and fuelโbefore buying a vehicle.
