AAA: It costs $12,863 annually to own a new vehicle, EV and hybrid fuel savings don’t offset higher costs
AAA’s newest Your Driving Costs (YDC) analysis finds that the average annual cost to own and operate a new vehicle is $12,863, or $1,071.92 per month.
The ownership costs AAA analyzed for the study reflect continued increases in fuel prices, depreciation, and finance charges, a press release states.
The sales-weighted average MSRP of a new vehicle in this year’s study was $39,376. AAA says that while MSRPs increased slightly, on average, incentives, demand, and rebates can affect what consumers ultimately pay. The actual purchase price is used to calculate finance costs and depreciation.
The YDC analysis estimates the cost of owning and operating a new vehicle for personal transportation over five years and 75,000 miles across fuel, maintenance, repair, and tire costs; taxes; depreciation; and license, registration, and finance charges. AAA notes that actual driving costs vary based on driving habits, location, operating conditions, and other factors.
In 2025, AAA found that the total estimated annual cost was $11,577, or $964.78 per month. However, AAA notes that methodology updates make this year’s results not directly comparable with last year’s estimate.
This year, AAA evaluated 45 vehicles across seven categories: small sedan, medium sedan, subcompact SUV, compact SUV, medium SUV, midsize pickup, and half-ton pickup truck, with hybrids and electric vehicles (EVs) integrated. In 2025, EVs and hybrids were separate categories. As a result, the previous numbers were calculated separately for EVs and hybrids and weren’t weighted to reflect the newer category inclusions.
“By looking at EVs, hybrids and traditional gas-powered vehicles within the same categories, consumers can better understand how total ownership costs vary by powertrain,” said Greg Brannon, AAA’s director of automotive engineering, in the release. “Looking at the full ownership picture — including depreciation and other expenses — can help consumers better understand the total cost of each option.”
The analysis found that, at the time of the study, the regular-grade gasoline used by nearly all YDC vehicles averaged $4.152 per gallon. In comparison, electricity for home EV charging averaged 18 cents per kilowatt-hour. AAA found that gas prices are up 31.8% compared to 2025, while electricity prices rose only 7.8%, “improving the relative affordability of EVs and hybrids; however, fuel economy alone did not determine the most affordable vehicle to own.”
The difference between a car’s purchase price and resale value remains the single largest ownership cost, with vehicles losing a weighted average of $4,422 per year, according to AAA. Vehicle type and purchase price significantly affect EV depreciation.
“For example, EV medium sedans had about twice the depreciation of gas-powered models, helping push total ownership costs 29.1% higher in that category,” AAA said.
AAA says that by comparing select electric and hybrid models within the same categories as gas-powered vehicles, shoppers are given a more practical view of how ownership costs compare across powertrains.
“Overall, gas models offered savings compared to EVs and hybrids in cost categories affected by purchase price, like finance charges, taxes and fees, and depreciation,” the release states. “For example, gas-powered medium sedans cost $10,582 per year to own — $3,080 less than comparable EV medium sedans, which had significantly higher depreciation, fees and finance costs.
“EVs delivered the lowest fuel costs, with charging costs for EVs about 66-70% lower than fuel costs for traditional gas vehicles across the categories studied. However, those savings were often outweighed by higher depreciation, fees, and finance costs; medium-sedan EVs, for example, cost 29.1% more to own annually than gas-powered models.”
AAA found that hybrids were the most consistently lower-cost alternative to gas in the comparison categories, combining meaningful fuel savings with smaller ownership-cost tradeoffs. This meant lower annual ownership costs than gas-powered models in medium sedans, compact SUVs, medium SUVs, and pickup trucks, according to AAA.
The study findings show that vehicle category makes a major difference in operating costs. For example, AAA says half-ton pickup trucks cost $1.10 per mile to operate, 48 cents more than small sedans, adding an average of $7,191 per year.
“In comparison, purchasing an EV may help offset annual fuel costs, but higher depreciation can increase total ownership costs over time,” the release states. “Choosing a vehicle that fits actual transportation needs can help buyers manage long-term costs.”
The study also found the average cost of a full-coverage auto insurance policy to be $2,098 a year for a personal vehicle driven by a policyholder under 65 years old with more than six years of driving experience, no accidents, and who lives in the suburbs or city.
Based on a five-year loan with 15% down at the national average interest rate, AAA says the average yearly finance cost for a new vehicle is $1,184, including taxes and the first year’s registration fees.
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