Ride Sharing Costs Two Times More than Owning a Car
Even with high parking costs, car ownership cheaper for city dwellers than Lyft or Uber.
DENVER (Oct. 24, 2018) – There are a lot of good reasons to regularly use ride-hailing services such as Lyft and Uber, from skipping parking headaches at the Pepsi Center to avoiding driving impaired. But if you think these apps are a cost-effective replacement for vehicle ownership, think again. According to a new analysis from the AAA Foundation for Traffic Safety, relying on ride-hailing services as your primary mode of transportation costs $20,118 annually -- more than twice the cost of owning a personal vehicle, even when factoring in the costs of fuel, insurance, parking, and the vehicle itself.
Per AAA research, the average driver in an urban area -- the only setting in which these services can serve as a practical full-time transportation option -- drives 10,841 miles per year. At that mileage, AAA calculates the average annual cost to own and operate a new vehicle is $7,321. Denver residents, meanwhile, would pay an average of $20,434 to travel that same amount by way of Lyft or Uber, exclusively. And, for Denverites with access to free parking at work and home, relying on ride-hailing services alone is nearly three times more expensive than vehicle ownership.
"For those who travel a very limited number of miles each year, or have mobility challenges that can prevent them from driving a personal vehicle, ride-hailing is a viable and important option for daily transportation," said AAA Colorado spokesman Skyler McKinley. "But, for everyone else, the car is still king."
To determine the average number of miles traveled by a city dweller, AAA's analysis leveraged data from the AAA Foundation for Traffic Safety's American Driving Survey. AAA's Your Driving Costs data served as the basis for all car ownership calculations, factoring in depreciation, fuel, maintenance, repair, financing, insurance, license, registration costs and taxes.
Total cost of ride-hailing is calculated based on data from 243,838 economy-level, single-rider trips in 20 U.S. urban areas, and does not factor in costs associated with carpooling or multi-modal transportation options. On average, those using ride-hailing services spent an average of $13.15 per trip, running 15.11 minutes and traveling 6.67 miles. Ride-hailing costs include the occasional use of rental vehicles for longer-distance travel. Full methodology can be found here.
Vehicle owners looking to minimize their operating costs should consider the following:
- Buy (gently) used: Depreciation is the single largest expense for vehicle owners. By driving a pre-owned vehicle in good condition, ownership costs are significantly lower. A safe, reliable vehicle can be found at an attractive price point.
- Fuel responsibly: Avoid wasting money on premium gasoline unless your vehicle specifically requires it and, if you're one of the 20 percent of Americans considering an electric car, these vehicles offer lower fuel and maintenance costs.
- Show your car some love: It sounds counterintuitive, but spending money on routine maintenance can actually save you money in the end. To keep engines running longer, consider switching to synthetic oil and upgrading to TOP TIER™ gasoline.
- Slow down: When gas prices are high, small changes in the way you drive can make a big difference.
About AAA Colorado
More than 680,000 members strong, AAA Colorado is the state's most-trusted advocate for the safety and security of all travelers. As North America's largest motoring and leisure travel organization, AAA provides more than 58 million members with travel, insurance, financial, and automotive-related services - as well as member-exclusive savings. For more information, visit AAA.com.