The Real Costs of Car Ownership

When car companies advertise their latest models, the cost of ownership is an important factor that is highlighted. Accurate data analysis makes it possible to predict the annual expenses for driving a certain vehicle in particular conditions. Automobile companies analyze data from official government agencies that regulate road safety and environmental pollution. Additionally, external sources such as insurance companies are also used to generate graphs for the cost of ownership of specific cars.

Automakers often boast about excellent fuel economy in select models such as compact cars or hybrid vehicles. Based on average driving conditions, the annual expenses of fuel could be accurately predicted. The grade of gasoline used is also carefully considered in the calculations for yearly expenses.

Some expenses involved with owning a vehicle depend heavily on external factors that are set by other businesses. For example, licensed drivers don’t have much control over their auto insurance premiums. However, the insurance rates depend heavily on the type of car that is driven. Modern safety features can significantly reduce rates for mandatory and optional insurance coverage. Anti-lock brakes, collision warning systems, backup cameras and four-wheel drive are some safety features that are evaluated by insurance appraisers. Family-friendly cars are considered to be very safe, and they often come with low cost of ownership as far as insurance costs are concerned.

Repair costs are also carefully considered in the long-term expenses of car ownership. Some cars can only be fixed with original parts that are much more expensive than some universal components. Additionally, repair shops may charge extra for servicing foreign cars compared to domestic vehicles.

A warranty also helps determine the long-term expenses of car ownership. Some car companies provide limited protection for up to 100,000 miles or five years, whichever comes first. New model cars comparison tools allow customers to make the best possible decisions based on projected future expenses. The bottom line is that drivers need to look beyond the manufacturer’s suggested retail price when shopping for a specific car that’s available for lease or purchase with loan financing.