Own a car? You're getting socked by higher prices, and not only for gas
Car ownership costs have soared 50% since 2020, according to new economic data. Here's where motorists are getting dinged.
Americans have been grappling with the rising cost of owning and operating a car in recent months. The war with Iran has driven up prices at the pump, but the financial burden extends far beyond fuel costs. A survey by Navy Federal Credit Union has revealed that car ownership expenses have surged by 50% since 2020. The primary drivers of this increase are not just the higher fuel prices, but also the steep rise in repair costs, which have jumped by 70% in the last five years.
The average repair bill for a new car is around $1,750 for the first five years of ownership, according to AAA data. Other contributing factors include rising auto insurance rates and higher routine maintenance costs, followed by the surge in gas prices. The average annual cost of full coverage car insurance is $2,124, while minimum coverage costs $816 per year.
People are keeping their vehicles for longer periods, leading to higher service charges. Cars now have more electronic components and sensors, which are more expensive to repair. Moreover, a shortage of mechanics allows them to charge higher rates. Despite gasoline still accounting for a significant portion of the costs, Americans are now paying an average of $4.33 per gallon, a 45% increase since the Iran conflict began in late February.
The total annual expense to own and operate a new vehicle is $12,863, or approximately $1,071.92 per month, as per AAA's analysis.
Written by urgent.news from CBS News's reporting — not their text. Machine-written — may contain errors; check the original before relying on it.
