The True Cost of Car Ownership!

Did you know that the average American could spend over $900k on car ownership in their lifetime? And if you calculated the opportunity cost of owning a car you could have $11 million in your bank account? I knew cars were expensive but that's insane! Let’s run the numbers and figure out what the heck is going on here!

Data sources can be found below.

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Table of Contents:
0:00 Intro
0:18 My Perspective
1:16 Purchase Costs
2:18 Car Expenses
3:39 Socialism for Cars
6:13 Percentage of Income
7:01 Affordability
7:54 Lifetime Cost of Car Ownership
9:00 Time Wasted
10:06 Can We Spend Less?
11:17 Can We Drive Less?
13:43 What Else Can We Do?
15:53 Wrap Up

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SOURCES FOR THIS VIDEO:

Music used in this episode:
- Selected tracks from the YouTube music library

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Clips used in this episode:
Suburb drone - alexanderguelph
Vegas - AndreConrad
Rush hour - WeatherNews
Amsterdam, work from home - Videvo
LA traffic - ABC7
Chicago bus - Videezy
Vancouver bus - CTV News
Bus - Cityxscape
SF bus - CBS News SF
Train - LA Metro
Dealership - Anthony Shkraba
Mechanic - Artem Podres
Biking - Rad Power Bikes
Biking - Blue Bird
Biking - C Technical
Subaru - Erik McLean
Woman with money - Karolina Grabowska
Suburb, exhaust, police - Kelly Lacy
Bus, exhaust - Mart Production
Stop sign - Marta Wave
Couple with money trouble - Mikhail Nilov
Mazda6 - Ojyrai
Parking - Oleh Shtohryn
Carpool - Pavel Danilyuk
Biking - Rodnae Productions
LA traffic - Saul
Lots of money -Tima Miroshnichenko
Montreal, biking - German Korb

[HelloRoad]

Do you want some of this money back in your pockets?

Also, some notes. My $14k/yr figure is likely too high because the $712/mo payment was an average for new cars, I mistakenly believed it was for a mix of new/used. $503/mo is the average for used cars so it’s likely somewhere in between. I also didn’t properly calculate depreciation. Perhaps it’s better to look at household car expenses as reported by the BLS, which comes in at $9562 (2020) which is still a lot. After 50 years of driving we could still be at $478, 100 spent. I also didn’t properly include tax/inflation for the opportunity cost so I will recalculate and add to the comments here. Thx.

For those that enjoy my videos with old '80s/'90s cars, don't fret. I don't really hate cars, I just really hate car dependency. New videos with my 1990 Pontiac Grand Am SE and 1988 Chevy Nova Twin Cam are coming soon. Thanks for watching and for your support.

[cra_]

I love how you describe it as "socialism for cars", because most Americans would call you a "commie" for simply suggesting the idea that car-dependent suburbs may not be the most pleasant places to live

[johnmitchell]

You didn't mention how many millions of people are permanently injured in automobile crashes every year

[WaynePittenger]

The rental advice is the best. I found myself needing a truck only once in the past 2 years. I spent $30 on the rental, picked up and dropped off what I needed, dropped off the the truck, and moved on with my day.

[alexcarrillo]

I love how you are paying attention to the other side of car ownership and car-centric infrastructure. We need more people talking about this. Thank you for bringing attention to this! Also, you're videos are well done. Looking forward to seeing more of your videos.

[rightlanehog]

Ethan, Thanks for this perceptive overview. I feel that Part 3 barely scratched the surface of 'socialism for cars'. A bill recently passed Congress authorizing untold $Billions for the direct subsidy of personal car purchases. This money is on top of the $Billions in direct corporate welfare transferred annually from middle class citizens to profitable transnational car makers. Let me assure younger viewers this was not always the case. Believe it or not, for most of the history of the automobile, carmakers used to pay for their own factories with their own money. The fact these subsidies are handed out a time when corporate income taxes as well as taxes on the wealthiest are a fraction of historic levels, makes them even more repugnant. Beyond these dubious inducements to buy and produce even more cars, we have the outrageous loopholes within the US tax code which have for decades incentivized the purchase of oversized, gas guzzling SUVs and luxury pickups over more efficient options. These misbegotten programs and policies epitomize the concept of socialism for the rich. They also left the much more socially responsible public transit systems cash starved and withering on the vine. Before anyone else says it, I know I am only scratching the surface but these egregious policies are rarely discussed in car friendly spaces.

[karikling]

It's also worth mentioning e-cargo bikes. They really can be car replacement bikes for the vast majority of trips, and on the rare occasion you might need to haul something huge, you can rent a van or truck. Seriously, those bikes are big enough that you can haul Christmas trees in them.

[martinicc]

It's refreshing to see car enthusiasts going against the status quo. I regret finding your videos so late.

[michaelprice]

The problem with biking everywhere, for me at least, is not so much that the infrastructure sucks, but rather there isn't usually a good place to leave a bike without fearing it will be stolen.

[DragPakMerc]

Good points. I bought a new car once. In 1989. Learned I hated making payments. So when it was paid off, I started saving the money. Every car I've purchased since has been used, and bought for cash. Only buying depreciated cars and avoiding financing charges hasn't saved me $11 million, but it's still been an amazing amount of money over the years.

[lannynavitka]

Learning how to fix your own vehicles is basically a retirement plan.

[Phillydreaming]

I have always been someone who is a car enthusiast but hates cars as a dependency. I moved to northern california from soflo just for the walkability, but also finally got my drivers license in this state. I love drifting and JDM (and the occasional nascar), but I refuse to own/register a car as a method of transportation because that just validates more urban sprawl. Its hard on the rare occasion that I have to go somewhere far like an appointment but I manage, and I could definitely not afford to live here if I owned one. The transit here is amazing too, compared to what is available in the south. When people talk about it sucking I try to inform them that the sun-tran bus back home literally went to about 5 or 6 different streets only.

[_JD_C]

Could not agree more, even the cheapest of cars costs a lot of money to maintain

[MARC-FENIX]

Such a lucid human being! I love that you bring the right amount of reason to the emotional side of car ownership. 🤗👍

[manireik]

One thing to keep in mind--those hundreds-to-thousands spent each month on cars can instead cover a lot of rent/mortgage costs, unlocking the ability to live in mixed-use, walkable and bikeable places (and regain all that lost time and quality-of-life).

If the cost of "affordable" housing is 2x cars and all their fixed and variable costs--the housing is not actually affordable! And conversely, somewhat more "expensive" housing that sheds all those car costs can turn out to be cheaper. That's why I haven't driven in 18 years, and have been able to afford to live in fun, convenient, interesting, even beautiful apartments and neighborhoods, on a typical middle-class (or lower) income (even with significant student debt payments).

[karankshah]

Remember kids, the more public transit people use, the more open the roads are.

[johnchedsey]

Not sure why Youtube decided to start recommending your videos, but I'm glad they did. There's even more costs associated with a car/oil dependent infrastructure. Just think about the military costs of ensuring we can get access to "cheap" oil to run our fleet of cars nationwide. Someone once estimated that it essentially means we're paying well over $10/gallon for gas factoring in that hidden cost. Probably closer to $20/gallon in today's money.

I absolutely love my road trips and I'm willing to spend a portion of my income to explore the US west and all the beautiful places I can visit on these trips. I have literally 10s of thousands of photos taken on these trips and those memories are priceless. But, at the same time, I've stuck with an older used vehicle that gets decent mileage (A Nissan Juke Nismo RS, which is both practical for my lifestyle and still a little fun). Clearly status is not a big deal for me. I've worked remotely for over a decade and essentially have been fortunate to just drive for pleasure. But I feel for all those who are stuck in this cycle that essentially allows so many hands to get into their pockets for the "privilege" of commuting.

[DctrBread]

i will also add, even if walking unsafe, almost nothing is more dangerous than a lifetime of driving, particularly if you think theres a chance that you are a distracted driver, an angry driver, or if you will ever drink and drive

[ave]

the fact you were able to be a car person and understand the reality of this situation gives me a lot of hope.. ive been really down in the dumps that so many people are not just blinded to this issue but so dogmatic and aggressive about it. keep doing what you're doing and i appreciate you taking the time to make this video!

[keilan]

I like the direction you are headed with this channel 👍. You earned a subscriber!