Here Are The Vehicles For 2020 That Are Cheapest To Own In The Long Run

The 2020 Toyota Corolla Hybrid is among the cheapest cars of the year to own, according to Kelley Blue Book. — The 2020 Toyota Corolla Hybrid is among the cheapest cars of the year to own, according to Kelley … [+] Blue Book.

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Though short-term auto leasing has swelled in popularity over the last several model years, a great many more motorists remain in it for the long haul. The average owner holds onto a car, truck, or sport-utility vehicle for around seven years these days and finances it for nearly that long. Smart buyers know that to get the best overall deal on a new vehicle they have to look beyond a vehicle’s sticker price and choose a model within a given size and price class that’s inherently cheaper to own over time.

The key factors to consider here are depreciation, fuel economy, insurance premiums, and the ongoing cost of maintenance and repairs. It may sound like a lot of work to research these variables, but gathering the data can be relatively easy, thanks to the experts at Kelley Blue Book. The KBB.com website provides detailed breakdowns of ownerships costs for each make and model within their new-vehicle price listings that can make choosing a bona fide long-term bargain a breeze. KBB just issued their annual 5-Year Cost to Own Awards, which notes the models in each of 22 categories for the 2020 model year that will be the cheapest to keep. We’re featuring them at the end of this post.

Among mainstream automakers, KBB cites Subaru as having the lowest overall ownership costs for its stalwart resale values across the its lineup. Meanwhile, Acura takes top honors among luxury brands, with many of its vehicles delivering relatively low operating costs. The model among those cited predicted to be the cheapest to own for five years is the 2020 Toyota Corolla Hybrid at $30,918.

Of the individual cost considerations, depreciation, or the rate at which a given model loses its original value over time, is the most significant. Depreciation accounts for around 40 percent of a typical vehicle’s ownership costs. While the average model loses around 63 percent of its worth after five years, KBB says the best performers in this regard lose only 40-50 percent of their original value over half a decade. This is an even more critical issue for those shopping in the luxury class, simply because there’s more money at stake to lose. Picking a $60,000 car that returns 10 percent more after five years than a comparable model will save its owner $6,000 at trade-in time.

Though fuel prices have remained relatively stable and affordable in recent years, the cost of keeping the tank filled can still add up over time. According to the EPA’s fueleconomy.gov website, choosing a vehicle in a given class that gets 10 additional miles per gallon than another will save an owner driving 15,000 combined city and highway miles annually $2,000 over a five year period. And if you live in a state that suffers much costlier-than-average fuel prices, like California and Hawaii, the stakes are even higher.

Insurance premiums are another big long-term expense. As the ads tell us, you can save money by shopping around and claiming all of a carrier’s discounts to which you’re entitled. But some vehicles are inherently cheaper to cover than others. Generally, vehicles that are the least expensive to purchase, tend to be driven gently, and are more affordable to repair after a crash will cost less to insure than will costly luxury cars that cost a fortune to fix, and red-hot sport coupes and convertibles that beg to be piloted aggressively.

Maintenance and repair costs can likewise come to be budget-busters, with the latter becoming critical once a new-vehicle’s warranty has expired. In general, luxury-branded models are the costliest to keep running. You can save cash here by choosing a vehicle with an above-average reliability rating and/or comes with an especially long warranty. Some automakers throw in free scheduled maintenance for an initial period, which can also help keep costs low; Hyundai recently initiated a program that covers the cost of oil changes, tire rotations, and other regular procedures for 3 years/36,000 miles.

With that in mind here are KBB’s 5-Year Cost to Own Award winners for 2020 and their predicted bottom line expenses: