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What's the actual cost to own a car?

What's the actual cost to own a car?

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That special deal on the new car you’re eyeing may look just as good as the vehicle’s glossy, unblemished finish. But what may seem to be a low, competitive price at the dealership may actually cost you more over the long haul. When you take into consideration all the costs over the period of ownership, for three or five years, for instance, you could end up paying far more for that seemingly nicely priced car.

Consumer Reports and Edmunds.com use similar factors in pricing longer-term costs of car ownership. They include depreciation, a car’s loss in value, which Consumer Reports says is “the largest cost factor by far”; fuel costs, which is where fuel efficiency numbers play a big part and what consumers tend to look at the most when gas prices are high; interest on payments; insurance, which is tied to various facts about the driver but can also have to do with the style of car (speedy sports cars, for example, will run up that insurance); sales tax; and maintenance and repair. Edmunds also factors in any tax credits for alternative-fuel vehicles.

As Edmunds concludes, “In many cases, TCO (true cost to own) points buyers toward an unexpected conclusion: Sometimes the cars that are cheaper to buy are more expensive to own.”

Here are a few examples of comparisons among various makes and models that will highlight the differences in costs over a five-year period.

Standard four-door sedan

First up is a standard four-door sedan. These three models are basic ones, with standard transmissions, and they’re all from 2015, the latest numbers available from Edmunds.com. The average price paid according to that site for a Mazda 3 iSport sedan is $19,476. Factoring in the long-term costs, the true cost to own is $31,683. A Volkswagen Jetta’s average price is $22,004, with a true cost of $36,946. A basic Nissan Altima sells for roughly $21,000, according to Kelley Blue Book, and the Edmunds true cost to own is $34,658.

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Four-door hatchback

With a four-door hatchback model, a Ford Focus SE hatch is $25,830 and has a cost to own of $32,486. A Volkswagen Golf sells for an average $19,525, with its true cost to own being $35,529. The Mazda 3 iSport hatchback has an average price of $19,925, and a cost to own of $31,753. The Mazda and the Golf sell for nearly the same price, but the Golf’s cost to own is almost $4,000 more.

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Full-size SUV

Last are a few examples of full-size SUVs. The Nissan Pathfinder, which sells for roughly $28,000 according to KBB, costs $48,975 over the long haul. A Mazda CX9 Sport’s average price is $31,080, and true cost to own over five years is $48,076. The Dodge Durango has an average price of $38,983, with a true cost to own of $54,321, making it the highest cost by more than $5,000.

When you’re looking at new cars, don’t just look at sticker price, special offers and fuel efficiency; include the other factors of a long-term cost to own. When you drive home with that beautiful new car, you’ll feel confident you’ve really gotten a good deal for the next five years.

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