The automotive market, online and off, is saturated with new and used cars that you can take a look at with just a click of a few buttons. Often overlooked during car research, the total cost of ownership is, essentially, a calculation of all the costs involved in buying and using a car over a period of time.1 This total cost of ownership, or TCO, includes not only the purchase and finance price of the car, but maintenance costs, fuel costs, insurance and the depreciation that happens over the entire life of the car. Knowing the total cost of car ownership is a great way to determine if the car is a good deal in the long run.
How much will a car cost me over its lifetime?
Now that you know how the total cost of ownership impacts the vehicle you may select, you might be wondering what your total cost of car ownership will be. This will depend on the kind of car you elect to purchase, but there are some general guidelines and averages for different types of cars that can give you a good idea of how much you’ll pay in the long run.
For a mid-size sedan (e.g. 2015 Honda Accord), the average cost over five years (including depreciation) amounts to $31,878.2 For an SUV (e.g. 2015 Ford Explorer), that cost increases to $43,358 during a five-year period. With a minivan (2014 Honda Odyssey), the average cost for five years was $39,240.
For more specialized vehicles, the costs start to fluctuate. A sports car (2014 Ford Mustang) has a total cost of ownership over five years of $37,510. For a truck (2014 Chevrolet Silverado) it comes in at $35,431, and for an electric car (Nissan Leaf) the average five-year cost is $31,992.
Depreciation, expenses, and car value
To get a little more in-depth, let’s break it down into cost per facet of ownership over those five years. Below, you’ll be able to consider factors like upkeep, fuel and insurance costs, and the how depreciation - the decline in value nearly all vehicle experience over time - affects value.