Reality Check: The Cost of High Gas Prices
Wednesday March 9, 2022
Our Kelley Blue Book team offers plenty of good advice for vehicle buyers; one of their most well-known features is the annual 5-year Cost to Own research. In that study, the team considers total vehicle-related costs an owner will likely have to cover during the first 5 years vehicle ownership. This includes out-of-pocket expenses like fuel and insurance, and vehicle depreciation (loss in value).
With the tragic war in Ukraine only getting worse, the world economy is feeling the pain. High gas prices pale in comparison to the losses felt in Ukraine, but high gas prices are a tough reality for many American families. Looking at operating costs by segment, based on an owner that drives 15,000 miles a year, the Kelley Blue Book Cost to Own research shows the average fuel costs per month by segment, based on average fuel costs over the past five years (roughly $3.00 a gallon). Looking forward, the team can calculate the ADDITIONAL cost for every $1.00 increase in a gallon of gas. More to the point, the chart below also shows the ADDITIONAL monthly cost now that the price of gasoline, on average, has increased nearly $1.50 from March 2021. (AAA price data.)
Owners of less efficient vehicles are feeling it the most. The driver of a full-size SUV is paying about $110 more each month to operate the vehicle. A full-size pickup now costs $100 more a month to operate compared to just one year ago – March 2021. The price hikes are impacting nearly all households. Drivers of subcompact and compact cars are paying $54 and $60 dollars more a month than a year ago, respectively. Even drivers of hybrids are not immune, with monthly gas costs for that group increasing by nearly $40 a month, according to the Kelley Blue Book research.