How much does it really cost to own a new car in 2025?
If you’ve been eyeing a new ride, you’ve probably noticed the sticker shock at dealerships lately. But here’s a twist: despite inflation and all the usual suspects driving prices up, the annual cost of new vehicle ownership has actually dropped. According to the latest AAA data, it now sits at $11,577 per year—down $719 from last year. That’s about $965 a month, which isn’t exactly pocket change, but it’s a nearly 6% dip. So, what’s behind this unexpected relief, and what does it mean for your wallet?
Why Are Car Ownership Costs Dropping Right Now?
Let’s get right to the heart of it. The main reason for this drop? Gas prices have cooled off. AAA points out that lower fuel costs, reduced depreciation, and softer finance charges are all helping to bring down the total bill. There’s also a subtle shift happening: more buyers are opting for affordable models, which pulls the average down.
Depreciation—how much value your car loses each year—has eased up too. The average new vehicle now loses $4,334 per year in value over its first five years, compared to $4,680 last year. That’s a small but meaningful improvement, especially for anyone who’s ever groaned at their car’s resale value.
How Do Different Vehicle Types Stack Up on Cost?
Not all cars are created equal when it comes to cost per mile. AAA’s study crunched the numbers on the five top-selling models in nine different categories. Here’s what they found:
– Small sedans are the clear winners, costing just 55.87 cents per mile to operate.
– Hybrids come in second at 63.94 cents per mile, thanks to their low fuel and maintenance costs.
– Subcompact SUVs are neck-and-neck with medium sedans, at 66.11 and 66.37 cents per mile, respectively.
– Full-size trucks? They’ll hit your wallet hardest at 98.54 cents per mile—almost double the cost of a small sedan.
– Electric vehicles (EVs) aren’t as cheap to run as you might expect, averaging 71.21 cents per mile. Why? Charging costs have crept up, and higher depreciation and insurance rates are taking a toll.
If you drive 10,000 miles a year, a mid-size pickup will set you back $7,911 annually. Jump to a full-size truck, and you’re looking at $9,854 per year. That’s a nearly $2,000 difference—money that could cover a family vacation or a year’s worth of streaming subscriptions.
Are Electric Cars Really Cheaper to Own?
The EV revolution is in full swing, but the numbers tell a more nuanced story. While gas-powered cars have benefited from falling fuel prices (averaging 13 cents per mile for fuel), EVs have seen charging costs rise by nearly a cent per kilowatt-hour. Add in steeper depreciation, insurance, and fees, and the total cost to own an EV is higher than many expected.
That said, the long-term picture for EVs could still improve as battery tech advances and more affordable models hit the market. For now, though, the savings aren’t as dramatic as some headlines suggest.
What’s the Smartest Way to Save on Car Ownership?
If you’re looking to trim your transportation budget, the data is clear: smaller cars and hybrids are your best bet. They’re not just cheaper at the pump—they also depreciate less and cost less to maintain. Unless you truly need the hauling power of a full-size truck, downsizing could save you thousands each year.
It’s also worth considering how many miles you drive. The more you’re on the road, the more those per-mile differences add up. And don’t forget about insurance, taxes, and financing—shopping around can make a bigger difference than you might think.
What’s the Bottom Line for 2025 Car Buyers?
Here’s the real kicker: even as cars get fancier and techier, the cost to own one is finally moving in the right direction. But the gap between vehicle types is wider than ever. A small sedan or hybrid could keep your monthly bills manageable, while a big truck or premium EV might double your costs.
The big takeaway? Car ownership isn’t about perfection—it’s about smarter adjustments. Start with one change this week, and you’ll likely spot the difference by month’s end.