According to the nation’s largest organization for motorists, the cost of owning and operating a new vehicle in 2007 remains basically unchanged from a year ago at 52.2 cents per mile, or $7,823 per year, when driving 15,000 miles annually.
“While costs for some items such as insurance and financing increased from the start of 2006, a lower cost for fuel at the end of last year offset these expenses resulting in no net increase in the average driving expense for 2007,” said Gail Weinholzer, director of public affairs, AAA Minnesota/Iowa.
The average fuel price dropped slightly from 9.5 cents per mile to 8.9 cents per mile compared to one year ago. Fuel prices in the study are based on the fourth quarter 2007 U.S. price for regular grade fuel, which averaged $2.256 per gallon as tracked in the AAA Fuel Gauge Report (www.aaafuelgaugereport.com).
The costs of maintenance and repair, tires and depreciation remain unchanged from one year ago. However, minor increases in the costs of insurance, financing and licensing, registration and taxes offset any savings consumers might have realized from lower fuel costs. (More detailed information on all costs is contained in the study.)
AAA’s Your Driving Costs looks at operating and ownership costs of five top-selling models in three popular size classes: small, medium, and large sedans. The results clearly show that consumers do have an opportunity to save substantial sums of money by switching from larger models to smaller vehicles.
For example, AAA’s research shows the average annual cost of driving a small sedan is $6,219 per year, while a large sedan costs almost 50 percent more to own and operate at $9,373 per year. Smaller, but still significant, savings can be realized by driving a minivan instead of a larger, more expensive and less fuel-efficient SUV. AAA estimates the annual expense of owning and operating a typical minivan at $8,639 per year based on 15,000 miles of driving. An SUV driven the same distance costs an average of $9,997 per year, AAA reports, which is over 15 percent higher.
AAA’s estimated average driving costs are higher than the Internal Revenue Service’s allowance for 2007 business mileage of 48.5 cents per mile. The IRS has never allowed full reimbursement of all expenses associated with automobile ownership and use. AAA first began publishing research on driving costs in 1950.
AAA’s study calculates the average costs of all expenses associated with owning and operating a vehicle over five years and 75,000 miles of driving using small, mid-size and large sedans. Covered expenses include fuel, maintenance, tires, insurance, license, registration, taxes, depreciation and finance charges.