When buying a new car, the MSRP is just the first payment made. To drive the car home, buyers must pay a delivery charge, taxes, and insurance. Over the ensuing five years, further costs build up on essentials such as servicing, fuel, wear and tear items, finance charges, and, on top of all that, the vehicle is depreciating in value. What you're getting in return is theoretically trouble-free motoring for at least three years as the car is under warranty, and peace of mind knowing the vehicle is being properly maintained.
However, we wanted to know the real cost of ownership over five years. So, we fired up our calculator and researched five family cars across the price and segment ranges in the US.
As taxes on new cars vary state to state, we're going to keep it simple and apply California's state tax and add a one percent county tax to each new purchase on the list. Delivery charges are also included as they are typically non-negotiable, and destination charges are also taxable. We also use the average miles driven per year according to the US Department of Transportation Federal Highway Administration. That number is split between male and female drivers, so we've rounded down slightly to 65,000 miles per five years as an average for fuel cost and depreciation. We've left out road tax, however, as that varies wildly across states.
2015 Honda CR-V (5-Year Cost-To-Own: $49,714)
In 2015, the upper mid-tier trim CR-V was the EX-L, with a starting price of $28,145 for the FWD model, excluding the delivery charge of $880. In 2015, California's sales tax was 6.5 percent, with an extra one percent going to the county of Riverside, adding $2,205 to the cost for a total of $31,202. From our research, average insurance costs came to approximately $1,160 per year (risk profile and insurer dependent), meaning before you could even drive the car off the dealer's lot, you were $32,362 out of pocket.
Honda has been offering free oil changes for the life of the vehicle and some basic maintenance, and the warranty in 2015 comprised a 3-year/36,000-mile New-Vehicle Limited Warranty and a 5-year/60,000-mile Powertrain Limited Warranty. However, over five years, it will need servicing, and some consumable items need replacing at an average of $1,825. Honda vehicles are notoriously reliable, but the previous generation is also notorious for the air conditioning system needing repair, so we'll use the higher end of the average repair cost at $2,005 out of warranty.
In total, factoring all the maintenance and repair costs mentioned and assuming the insurance rate remains the same, a financing cost of $2,972 and a fuel cost of $950 per year, we estimate the cost of ownership for a 2015 Honda CR-V, after purchase and delivery, to be $20,689 over five years. We're looking at a total cost-to-own price of $49,714. The reality is, owning a 2015 Honda CR-V EX-L FWD costs 1.7 times more than the MSRP.
Purchase Price: $28,145
Delivery charge : $880
Taxes (CA 2015=7.5%): $2,177
Insurance (5 years): $6,960
Financing fees: $2,972
Maintenance: $1,825
Repairs (average cost only for years out of warranty): $2,005
Fuel (average EPA for 13,000 miles/year over five years): $950 x 5 = $4,750
Total Spend Over Five Years: $49,714
Depreciation: $13,075
Money Left For Next Car: $15,070
Tesla Model S (5-Year Cost-To-Own: $89,937)
Tesla's all-electric Model S has been on the market since 2012, and in 2015 the base 60-kWh battery model cost $69,900. Most were subject to a $1,200 delivery charge, bringing the total to $71,100. Add $5,332.50 in California taxes, then subtract the $7,500 federal tax credit and $4,000 California rebates for EVs (for those who qualified for the full amount), and Tesla customers were saving money. It brought the Model S's initial cost down to $64,932, but insurance bit hard at $2,142 per year. Still, $67,074 to drive off the lot was a decent deal, and financing costs averaged out at $6,305. The maintenance cost for an EV is low as it needs no fluids, and there are fewer mechanical parts. Following Tesla's recommendations and pricing in a set of tires and brake pads, customers will have spent around $1,800 over five years. A 4-year/50,000 mile basic and 8-year/125,000-mile powertrain warranty means Tesla owners are on the hook for quality issues outside the drivetrain in year five, at an average cost of $1,700.
There's a long list of common problems with the Model S, mostly associated with bodywork, weatherproofing, and electrical faults. Averaging out the cost to fix those, we've added $1,490 to the cost to own. As the Model S doesn't drink gas, it cost around $3,000 in charging fees to drive 65,000 miles. That means the true cost of ownership for a 2015 Model S is $89,937, making it 1.2 times more expensive than the original MSRP.
Price: $69,900
Delivery charge: $1,200
Taxes (CA 2015=7.5%): $5,332
Federal and state incentives: -$11,500
Insurance (5 years): $10,710
Financing fees: $6,305
Maintenance: $3,500
Repairs (Average cost only for years out of warranty): $1,490
Fuel (Average EPA for 13,000 miles/year over five years): $3,000
Total Spent over five years: $89,937
Depreciation: $40,600
Money Left For Next Car: $29,300
2015 BMW 3 Series (5-Year Cost-To-Own: $59,244)
BMW's 3 Series is the go-to model for a premium compact sedan, and in 2015, it started at $32,570 for the 320i in base form. Add $950 in delivery charges, $2,514 in taxes, and $1,640 for the first year of insurance, and BMW customers were able to drive one off the dealer lot for $37,674. With financing, we add another $3,044 to the total cost. BMW services generally come in every 10,000 miles but get expensive, averaging around $4,555 over five years, including consumables - items like run-flat tires and synthetic oil are not cheap. Out of warranty, it tends to be smaller electrical issues as the timing chain guides issue was ironed out of the 2014 model, so we've factored in $911 for repairs. Fuel cost averages at an expensive $6,500 over 65,000 miles, so that brings the total cost of ownership to $59,244, a whopping 1.7 times the original MSRP.
Price: $32,570
Delivery charge: $950
Taxes (CA 2015=7.5%): $2,514
Insurance (5 years): $8,200
Financing fees: $3,044
Maintenance (5 years): $4,555
Repairs (Average cost only for years out of warranty): $911
Fuel (Average EPA for 13,000 a year over five years): $6,500
Total Spend Over Five Years: $59,244
Depreciation: $20,920
Money Left For Next Car: $11,650
2015 Ford F-150 (5-Year Cost-To-Own: $50,549)
The base model F-150 was the XL Supercab with a cost of $26,030 in 2015 plus a $1,195 delivery charge. Add another $2,086 for California tax in 2015, insurance at $1,431 for the first year, and you will have paid $31,327 to drive it home from the dealer. Over the next five years, financing costs an average of $3,377 and around $6,500 in fuel for the V6 engine. The F-150 has few regularly reported issues other than cracked manifolds, so it clocks in an average of $3,505 in maintenance and $701 in repairs.
A 2015 XL Supercab will have cost its owner $50,549 over five years, or approximately 1.8 times the original base price.
Price: $26,030
Delivery charge : $1,195
Taxes (CA 2015=7.5%): $2,086
Insurance (5 years): $7,155
Financing fees: $3,377
Servicing: $3,505
Repairs (Average cost only for years out of warranty): $701
Fuel (Average EPA for 13,000 a year over five years): $6,500
Total Spend Over Five Years: $50,549
Depreciation: $9,010
Money Left For Next Car: $17,020
2015 Toyota Camry (5-Year Cost-To-Own: $43,334)
The advantage of a Camry is its legendary reliability and low long-term cost of ownership. We're just interested in the first five years here, though, and in 2015 you would have spent $23,840 on the most popular SE trim. Add an $825 delivery charge, $1,850 in tax, and $1,336 to insure it, and you drove home for a total of $27,851. You can then add $2,499 in financing costs, $5,000 in gas, and $1,890 in services over five years. There may be some small issues once the warranty has run out, so we're factoring an average of $750 in the last two years.
After doing the math, a 2015 Toyota customer has a total cost of ownership at $43,334, or about 1.7 times the original MSRP.
Price: $23,840
Delivery charge : $825
Taxes (CA 2015=7.5%): $1,850
Insurance (5 years): $6,680
Financing fees: $2,499
Maintenance: $1,890
Repairs (Average cost only for years out of warranty): $750
Fuel (Average EPA for 13,000 a year over five years): $5,000
Total Spend Over Five Years: $43,334
Depreciation: $13,565
Money Left For Next Car: $10,275
Verdict: Tesla On Top
Over five years, BMW's reputation of being expensive to own appears to be in line with the numbers. But what's truly surprising is that it's pretty much the same cost to own, proportionally speaking, over five years as a Toyota Camry and a Honda CR-V, leaving owners around $40,000 out of pocket. Unsurprisingly, both the Honda and Toyota vehicles cost roughly the same to own over the first five years. Slightly more expensive than the BMW, Honda, and Toyota models is Ford's F-150. In reality, BMWs are rarely bought in the base spec, and if we were to extend the period of ownership by another few years, we would expect the BMW to become the most expensive.
The least shocking result, given its tax breaks from 2015 and low fuel cost, is the cost to own a Tesla Model S over its first five years. If we remove the tax breaks from the equation, we get a cost to own over five years of $101,437. Even without the tax breaks, the Tesla Model S cost just 1.4 times its MSRP over five years, and, proportionally, remains the cheapest to own over five years.