AAA Estimates the Cost of Owning a Car in 2026

When people think about buying a car, they often focus on the purchase price and overlook the expenses that follow. Fuel, maintenance, loan interest, depreciation, insurance, and taxes can all add up, even if they are not immediately obvious.

To better understand those expenses, AAA studied car ownership costs in 2026. The group found that the annual cost of owning and operating a new vehicle has climbed to $12,863, or $1,071.92 a month. That compares with an average of $11,577, or $964.78 a month, in 2025.

At that level, ownership costs add 32.67% to the $39,376 sales-weighted average MSRP of new vehicles. AAA linked the higher bills to rising fuel prices, faster depreciation, and steeper finance rates. Even so, the total a driver pays can vary widely depending on the vehicle’s fuel type.

EVs cost more to own than gas and hybrid models

While all cars are becoming more expensive to own, AAA’s research highlights a bigger issue: electric vehicles generally cost more to own than gasoline or hybrid alternatives. The main reason is depreciation, which tends to be worse for EVs. In addition, EV owners often face higher fees and financing costs. Their advantage is lower fuel expense, since electric models typically cost 66% to 70% less to run than gasoline vehicles.

Using average consumption figures, AAA said regular gasoline averaged $4.152 per gallon, while home charging for electric cars was as low as 18 cents per kilowatt hour. Electricity prices have also risen more slowly, increasing 7.8% since 2025, compared with a 31.8% jump in gas costs.

Even with those fuel savings, EVs still cost more overall because of fees, financing, and depreciation, with some models losing value at roughly twice the pace of comparable gas vehicles. That pushed EV ownership costs above gasoline models in the medium sedan, compact SUV, and pickup truck segments.

The widest gap appears in the medium sedan category, where gasoline models cost $3,080 less to own at $10,582 a year than comparable EVs at $13,662. Hybrids are cheaper still at $10,204 and rank as the least expensive option to own across every category. In the medium SUV segment, however, EVs edge out gasoline models slightly, at $14,332 versus $14,431.

How to lower the cost of owning a car

Every mile driven carries a cost, but there are ways to keep expenses under control. One option is to compare insurance quotes and look for vehicles that are cheaper to insure.

Drivers who prefer gasoline vehicles should also pay close attention to fuel economy. Modern gas-powered cars are far more efficient than they used to be, and some of the most efficient models can achieve up to 58 mpg.

Depreciation is another major factor to watch. AAA says it is among the largest ownership expenses and can add a weighted average of $4,422 a year to the cost of running some popular models. Toyota, Subaru, and Honda are among the brands that hold their value best, while Lexus stands out as the luxury brand with the strongest resale value, according to CarEdge.

Luxury vehicles can bring higher maintenance and parts costs than mainstream brands such as Toyota or Honda. Keeping up with routine maintenance is another important way to limit long-term costs, since it can help avoid bigger repair bills later and support resale value when it is time to sell.