Navy Federal Credit Union has published its latest Car Ownership Cost Outlook (COCO) Index, showing a 3.4% rise in vehicle ownership expenses since September 2024. According to the data, costs have increased nearly 42% since January 2020, almost twice the pace of general inflation during that period. The COCO Index uses Bureau of Labor Statistics information to track eleven significant aspects of car ownership costs.
The report comes as more Americans prepare for holiday travel and many employers require more in-office work, placing added pressure on transportation budgets. Since September 2024, repair costs are up by 11.5%, body work costs by 5.4%, used vehicle prices by 5.1%, and maintenance and servicing by 5.1%.
“The Cost of Car Ownership Index is at a record high, surging almost 42% since January 2020,” said Heather Long, Navy Federal’s chief economist. “While overall inflation is up 25% since January 2020, the cost of car ownership has surged even higher, helping explain why so many Americans remain frustrated with the higher costs of basic aspects of their lives. U.S. drivers can’t catch a break.
“When during the pandemic first began, used car prices spiked as production fell and people were looking for cheap vehicles to avoid public transit,” Long continued. “Then gas prices surged to $5 a gallon. Then repair and insurance costs spiked. Now used car prices are climbing once again, up 5.1% in the past year as many Americans can’t afford new cars and are increasingly turning to used cars. People are also trying to fix their current vehicles to keep them as long as possible. Repair costs are up 11.5% in the past year, partly due to demand for more repairs and partly due to tariffs causing price hikes for critical parts. With new car prices topping $50,000 for the first time ever this fall, it’s unlikely there will be relief any time soon on the costs to buy and maintain vehicles in the United States.”
Kevin Wince, vice president of consumer lending operations at Navy Federal, said: “Car ownership costs have been steadily rising, but the end of the year remains one of the most favorable times to shop for a vehicle.” He noted that dealerships tend to offer stronger incentives in November and December as they aim to clear inventory and meet annual targets.
“These opportunities can help buyers save, but preparation is key," Wince added. "Securing preapproved financing and avoiding overly long loan terms can help ensure a purchase that fits your budget.
“Navy Federal members can also take advantage of our TrueCar partnership to search for the perfect vehicle within their price range and use our online calculators to determine what vehicle they can comfortably afford,” he continued. “Taking time to research options and understand pricing trends can make the difference between a smart purchase and a financial strain. With a little planning, consumers can turn seasonal deals into lasting value.”
Navy Federal last updated its COCO Index in September this year.
Founded in 1933 with seven members, Navy Federal Credit Union now serves over 15 million members worldwide as one of the largest credit unions globally.