AAA Survey Says Small Sedans Are Cheapest Cars to Own

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Small sedans are the cheapest cars to own and operate on a yearly basis, according to a new study of 2017 cars, pickups, and SUVs conducted by the American Automobile Association and released Wednesday.

On average, out of nine categories of vehicles analyzed, AAA calculated that a typical small sedan has an annual driving cost of $6,354. The most expensive? Pickup trucks have that dubious distinction, with annual ownership costs at a cool $10,054 per year.

The study looked at 45 model year 2017 vehicles and factored in a yearly driving average of 15,000 miles. Cars grouped into AAA’s “Small Sedan” segment include the popular Honda Civic, Chevrolet Cruze, Ford Focus, Hyundai Elantra, and Toyota Corolla. (See the Consumer Reports buying guide for sedans.) Segment comparisons were created by reviewing the top-selling five vehicles in each, AAA said.

Though the vehicle’s sticker price is weighed into the ratings, AAA emphasizes that the price paid at the dealership is only one part of the cost of ownership.

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"As the study highlights, initial purchase price is only the beginning,” explained Jennifer Stockburger, director at Consumer Reports’ Auto Test Center. Stockburger emphasizes that choosing a car with a strong track record is vital when it comes to making a smart, long-term investment in a car. “Choosing a reliable vehicle can reduce maintenance and repair costs throughout the vehicle's life, making total cost of ownership lower."

This advice is echoed by John Nielsen, AAA’s managing director of Automotive Engineering and Repair. “While sales price is certainly a factor, depreciation, maintenance, repair and fuel costs should be equally important considerations for anyone in the market for a new vehicle,” Nielsen said in a statement.

Electric vehicles, for example, have fewer moving parts and, subsequently, routinely have lower maintenance costs. They also don’t have to take fuel usage into consideration. However, AAA found that typical EVs are hurt by higher rates of depreciation. With an annual cost estimated at $8,439, the EV category is relegated to fifth place out of the study’s nine categories.

Tesla owners—a vocal community in the automotive world—might question this midrange ranking. But the Silicon Valley-based automaker’s electric-powered Model S sedan and Model X SUV weren’t included in the study because of their premium sticker prices, explains Greg Brannon, AAA’s director of automotive engineering. The cheaper of the two vehicles, the Model S, has a starting price around $70,000.

“AAA evaluated five models, focusing on popular midrange electric vehicles,” Brannon said to CR. Those five were the BMW i3, Chevrolet Bolt, Fiat 500e, Kia Soul EV, and Nissan Leaf. “While the Tesla Model S and Model X are among the top-selling electric vehicles, AAA’s Your Driving Costs study does not include vehicles at a luxury price point. As a result, this manufacturer was excluded from this year’s evaluation.”

Brannon cautions consumers to carefully weigh what they need and value most in any new car, truck, or SUV. “From AAA’s perspective, the key takeaway is for car buyers to understand all of the costs that go into owning and operating a vehicle, and weigh them based on one’s automotive needs and desires. Every type of vehicle has its pros and cons.”

Shoppers considering a small SUV, currently the car world’s most booming sales segment, will be happy to learn that AAA’s “Small SUV” category ranked second lowest in yearly ownership costs. This field includes SUVs such as the Ford Escape, Honda CR-V, Chevrolet Equinox, Nissan Rogue, and Toyota RAV4. On average, they cost an estimated $7,606 annually. That’s $1,252 more than for small sedans.

CR’s Stockburger says an intelligent car buyer will factor both short- and long-term savings into their purchase, and use these savings to add extra safety features onto their vehicle. This has the added benefit of easing consumer fears that a smaller vehicle is somehow inherently less safe.

"Some buyers have concerns about the safety of smaller vehicles in a crash, which is why we always say to buy as many safety features as you can afford,” Stockburger says. A lower entry price and larger budget for optional safety equipment can present a win-win scenario for consumers. “With a lower initial cost, you may be able to afford newer, more advanced safety features, which may help you avoid a crash in the first place."

Other factors working to the benefit of small sedans is their overall fuel economy and rate of depreciation. AAA’s Brannon says that “SUVs have higher annual depreciation costs, measured in dollars, than do similarly sized sedans.” The boxy, less wind-resistant shape and additional weight of a typical SUV—even among those on the smaller side of the spectrum—also impacts fuel economy. On the other hand, Brannon notes, “SUVs are cheaper to insure than comparably sized sedans.”

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