The American Automobile Association has updated its Your Driving Costs (YDC) analysis for 2026, finding that the average annual cost of owning and operating a new vehicle has increased to $12,863, or $1,071.92 per month, compared with $11,577, or $964.78 per month in 2025.
Higher fuel prices, depreciation and finance charges all contributed to the increase, while the growing popularity of electrified powertrains also shaped the cost differences among gasoline, hybrid and electric vehicles.
AAA Your Driving Costs 2026 Analysis
AAA’s YDC analysis estimates the cost of owning and operating a new vehicle for personal transportation over five years and 75,000 miles. Actual driving costs vary based on driving habits, location, operating conditions and other factors.
The analysis examined seven vehicle categories and included fuel, maintenance, repairs, tires, licensing, registration, taxes, depreciation and finance charges.
Fuel Prices and Depreciation Raise Ownership Costs
AAA said fuel and electricity prices increased from the previous year. Gasoline prices were 31.8% higher, reaching an average of $4.152 per gallon, while electricity prices increased 7.8% to 18.0 cents per kilowatt-hour.
Depreciation remained the largest factor affecting vehicle ownership costs. AAA found that vehicles lost a weighted average of $4,422 in value each year across internal-combustion, hybrid and electric vehicles.
Electric vehicles had the highest depreciation rate, at twice that of gas-powered models. As a result, total ownership costs were pushed 29.1% higher in the category.
New Vehicle Prices and Financing
The sales-weighted average MSRP of new vehicles in 2026 was $39,376. The figure increased slightly from last year, while incentives, demand and rebates also affected the ultimate cost of ownership.
AAA’s analysis considered these factors alongside the vehicle’s MSRP when examining yearly ownership expenses.
Gas, Hybrid and Electric Vehicle Costs
AAA also compared gasoline-powered vehicles, hybrids and electric vehicles within the same categories to show how total ownership costs vary by powertrain.
“By looking at EVs, hybrids, and traditional gas-powered vehicles within the same categories, consumers can better understand how total ownership costs vary by powertrain,” said Greg Brannon, AAA’s director of automotive engineering. “Looking at the full ownership picture—including depreciation and other expenses—can help consumers better understand the total cost of each option.”
Gasoline-powered vehicles offered savings in some areas compared with electric and hybrid models, despite higher gasoline prices.
Electric vehicles had charging costs that were 66%-70% lower than fuel costs on average. However, AAA said higher depreciation rates, fees and financing costs offset some of those savings.
According to AAA, a medium-sized gas-powered sedan costs $3,080 less to own than a similarly sized electric sedan.
Hybrids Show Lower Annual Ownership Costs in Several Categories
AAA found that hybrids were the most consistently lower-cost alternative to gasoline and electric vehicles across the comparisons in its analysis.
Hybrids used less fuel than gasoline-powered vehicles and had lower ownership-cost tradeoffs. They also cost less annually than gas-powered models in the medium sedan, compact and medium SUV, and pickup truck segments.
Overall, AAA’s 2026 analysis found that the average annual cost of owning and operating a new vehicle reached $12,863, reflecting the combined impact of fuel, depreciation, financing and other ownership expenses.
