P&A Providers & Administrators
MenuMENU
SearchSEARCH

New-Vehicle Ownership Costs Keep Going Up

AAA analysis shows big increase over last year, blames inflation, interest rates.

August 31, 2023
New-Vehicle Ownership Costs Keep Going Up

Half-ton pickups like the Ford F-150 have the highest average cost and have experienced a drop in demand as the costs of owning them now rival that of 'many luxury cars.'

IMAGE: Ford

2 min to read


The annual cost of owning a new vehicle has ballooned due to still-inflated prices and elevated interest rates, a new AAA study shows.

The motor clubs federation, known for its auto insurance and roadside assistance, says the annual average cost of owning and operating a new vehicle this year is $12,182, or $1,015 a month, up about 14% over last year’s figures.

Ad Loading...

It points to the growing average manufacturer’s suggested retail price, which it said is now $34,876, up about 5% over last year, combined with the average annual finance charge that MSRP impacts: $1,253, up a whopping 90% year-over-year.

Though the effects of the pandemic on the inflated costs have diminished this year due to improving inventories, “the spillover effects are keeping prices high,” says AAA Director of Automotive Research Greg Brannon.

AAA emphasizes that the price consumers pay for vehicles doesn’t always reflect MSRP, depending on demand.

The nonprofit organization said ownership cost is also probably impacted by:

Depreciation, which it projects to be up 24% year-over-year to an average of $4,538 per year.

Ad Loading...

The increase in new-vehicle prices relative to used-vehicle values, which it says have fallen in the past year.

Automakers’ focus on producing more high-end, and therefore more expensive, models.

Fuel, at least for gas-powered vehicles, was the one variable in the annual cost mix that fell, by an average cost per mile of about two cents. But electric-vehicle charging rose by nearly two cents per kilowatt-hour, it says likely due to inflation.

AAA pointed out that half-ton pickups, with the highest average cost, have experienced a decrease in demand as the costs of owning them now rival that of “many luxury cars.”

LEARN MORE: Used Market Hums Along

Originally posted on Auto Dealer Today

More Industry

Dodge ram emblem on orange vehicle exterior
Industry•by Hannah Mitchell•October 6, 2026

Gem State Stores Change Hands

A larger auto group founded in the industry’s early years sold two franchises to a neighbor group that's on a growth spurt.

Read More →
Graphic of model car driving on fake road.
Industry•by Lauren Lawrence•October 6, 2026

Charging In Motion

Honda has been researching wireless in-motion charging for electric vehicles since 2025, and new technology developments have put it a step closer to a final product.

Read More →
front grill of a Ford truck with blue Ford emblem
Industry•by Lauren Lawrence•September 30, 2026

Twin Cities Stores Sell

Minnesota-based Walser Automotive Group made what it called the most significant acquisition in its history with a three-rooftop deal in Minneapolis.

Read More →
Ad Loading...
Diesel engine on a production line in a factory
Industry•by Hannah Mitchell•September 29, 2026

U.S. Auto Sales Still Below Prepandemic Levels

Mobility Global industry observers don’t expect the market to return to the higher volumes that became routine before Covid but to stay well below its potential.

Read More →
Front of red tesla car.
Industry•by Lauren Lawrence•September 22, 2026

The Powertrain Shift

Electric-vehicle owners are backpedaling, according to new data, with product availability driving many to shift back to gas-powered engines.

Read More →
White BMW SUV driving on road.
Industry•by Hannah Mitchell•September 15, 2026

Achromatic Autos

The shades that dominate the U.S. car market don’t call attention to themselves, though grayscale may have plateaued after a 30-year upswing, research shows.

Read More →
Ad Loading...
Line of eclipse SUVs in parking lot.
Industry•by Lauren Lawrence•September 15, 2026

Used-Vehicle Affordability Worsens

Listing prices in August defied seasonal trends, rising above $27,000 for the second time this year.

Read More →
Two businessmen shaking hands in front of a vehicle
Industry•by Hannah Mitchell•September 8, 2026

First-Half Dealership Deals Up

Buy-sell activity shows that acquirers are looking for value and scale as many retailers seek to leave an increasingly competitive and complex market, Kerrigan Advisors reports.

Read More →
Kia Niro SUV in gold color parked outdoors
Industry•by Hannah Mitchell•September 1, 2026

Kia Closes Out Summer With a Bang

Its U.S. subsidiary broke multiple records in August, in part due to a surge of demand for hybrids models.

Read More →
Ad Loading...
Outside of Auto Park Ford dealership
Industry•by Lauren Lawrence•September 1, 2026

Indiana Dealership Changes Hands

A 30-year-old Ford dealership in Indiana has a new owner and will soon be undergoing renovations to meet manufacturer requirements.

Read More →