Study Finds Just How Much More Expensive Car Ownership Has Gotten
Inflation has finally been slowing donw this year, with President Joe Biden declaring in December that it was down nearly two-third from its peak of 9.1 percent in June 2022. But for many Americans, car ownership is still a very real pain being felt in the wallet. And unlike your grocery bill, it doesn’t appear that the financial burden is going to lift anytime soon.
According to the home and car insurance company Jerry, citing data from the U.S. Bureau of Labor Statistics, car insurance and repairs climbed faster than any grocery food item throughout 2023 when comparing prices in December 2022 to prices in December 2023.
According to the study, car insurance alone climbed 20 percent in 2023, which is the fastest pace in at least four decades, rising six times faster than overall inflation. And that’s unfortunately part of a trend, as car insurance prices have now increased to a total of 43 percent in the past three years alone. Meanwhile, car repair costs increased 10.3 percent in 2023, three times as fast as overall inflation, with vehicle maintenance costs rose rising twice as fast as inflation at 7.1 percent.
The research likewise found that the annual rate of price increases for major car ownership expenses such as insurance, the price of new and used vehicles, parts, repairs, and maintenance all hit multi-decade highs between December 2020 through December 2023. The cost of new and used vehicles, in particular, skyrocketed to the most since at least 1954.
Since December 2020, vehicle maintenance and used vehicle prices at a 27 percent and 24 percent increase have outpaced all grocery items with the exception of eggs. And that’s only partly due to the price of eggs dropping 24 percent in 2023.
This isn’t the first study that’s put car ownership woes under a microscope. The New York Times found last September that the average annual cost of vehicle ownership was up more than 13 percent to over $12,000 in 2022, or just over $1,000 a month, according to AAA research. And that’s not even accounting for gas prices, which are expected to spike just in time for Valentine’s Day/