COST OF OWNING & OPERATING Automobiles, Vans, and Trucks

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The cost of owning and operating a motor vehicle is of
major significance, as Americans experience increasing demands
on their incomes. It costs about $14,000 to purchase a 1991
intermediate-sized model year car. If it is driven 128,500
miles by one owner over a period of 12 years, the total cost to
the owner will be about $42,700. During that time it will cost
about $16,300 for depreciation and finance charges, $9,050 to
insure the vehicle, $7,800 (including taxes) for some 6,500
gallons of gasoline, $200 for oil, $5,350 for maintenance and
repair work, $1,250 for fires, $1,650 for parking and tolls,
and, for Maryland drivers, $1,100 for license, registration,
and vehicle excise tax. The pie chart below illustrates a
breakdown of total costs over twelve years for the 1991
intermediate-sized model year car. Tax revenues for gasoline
and oil are used primarily for improvements to roads on which
the vehicle is driven and account for less than five percent of
the total costs. The average annual cost of $3,560 represents
about 12.3 percent of a household's 1991 disposable income.

This report updates The Cost of Owning and Operating
Automobiles and Vans -- 1984. It traces selected vehicles in
personal use and their costs through a 12-year lifetime of
128,500 miles using 1991 data. The user is cautioned against
making direct comparisons between the costs reported in this
and previous issues. The study methodology has been modified
(details below). As with earlier reports, costs are based on
operation to typical vehicles in the Baltimore, Maryland,
suburbs. A worksheet for developing costs for the first year of
a vehicle's life in other localities is provided at the back of
this report. Although a vehicle will usually pass through three
or more owners during its life, the cost resulting from
transfer of ownership are not included in this report.

The average annual cost of $3,560 represent about 12.3 percent
of a household's 1991 disposable income.

Methodology For the Study: The basic methodology for this
study was modified somewhat from the used in the 1984 study.
For the 1991 study, vehicle lifetime mileage was increased from
120,000 to 128,500. The five vehicle classes used for the 1984
study have been retained, and three additional classes have
been added: compact pickup trucks, full-sized pickup trucks,
and minivans. The average age of an automobile (7.8 years) is
higher now than it has been at any time in the post-World War
II period. The average annual mileage per vehicle is
approximately 10,700, with travel decreasing as the age of the
vehicle increases. As in the 1984 study, the cost of the home
garage or a parking facility was omitted. In a suburban
setting, parking facilities range from curb parking to paved
drive ways to carports to fully-enclosed garages, with an
equally wide range in costs. In suburban areas, garage costs
are not usually a factor in automobile purchase or use
decisions. Only costs to the vehicle owner are addressed. The
costs of vehicle emissions and other external costs of vehicle
use are not considered.

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