Smart shoppers need to look beyond a car’s sticker price to get the best long-term deal.
While most new car shoppers tend to focus on the out-the-door transaction price or perhaps even a vehicle’s monthly payment, consumers with an eye on the bottom line should consider the full range of ownership costs to save the most money over time.
The most important costs to track include a model’s depreciation, fuel costs, and insurance premiums, and to a lesser degree the cost of financing, projected maintenance and repair expenses, and state and local registration and fees.
That’s a lot of numbers to run down, but fortunately the experts at the auto-industry research firm Vincentric have already done the legwork, identifying the cars and trucks that can be expected to deliver the lowest five-year ownership costs in their respective vehicle segments. We’re featuring the cheapest-to-own cars here, with pickup trucks, SUVs and minivans, and hybrid and electric cars featured in separate posts. Vincentric’s breakdowns of ownership costs for all makes and models are included with the full range of new-vehicle pricing data posted online at NADAguides.com.
The biggest variable here is a car or truck’s depreciation, which is the difference between its original sticker price and what it can be expected to be worth down the road. All of the models cited here for low ownership costs have among the lowest rates of depreciation in their respective classes. And be aware that this factor becomes increasingly important among higher-cost models, simply because there’s more money at stake. For example, a five percent difference in depreciation after five years on a $30,000 car amounts to $1,500, while the same spread with a $70,000 model is $3,500.
Though fuel remains reasonably affordable, even nominal savings at the pump can still add up to a significant chunk of cash over time. For example, the difference in fuel costs between a vehicle that’s rated at a combined city/highway 25 mpg and another at 35 mpg, with both driven 15,000 miles annually, adds up to $2,031 over five years with gas at $2.37 a gallon.
Always check in advance what you’ll pay for insurance on all models you’re considering, and shop around among major carriers to find the lowest rates. While premiums are based largely on a policyholder's age, marital status, address, and driving record, some vehicles, particularly family-minded minivans and SUVs, are inherently cheaper to insure than others – often by several hundred dollars or more per year – based on their claims histories. As it stands the difference between the least- and most-expensive new vehicles to insure is close to $3,000 per year.
We're featuring the 15 cheapest-to-own cars for 2017, based on Vincentric’s annual Lowest Cost To Own In America awards, in the accompanying slideshow.