I own a car · Guide for Arkansas
The real cost of owning a car, by vehicle type
The price is the least of it. What you pay every year in depreciation, insurance, fuel and maintenance decides whether the car suits you.
The average new car in the United States costs $11,577 a year to own and operate: about 77 cents per mile at 15,000 miles (AAA, 2025). And the biggest piece is not gas or the shop: it is depreciation, the money the car loses in value while it sleeps in your driveway. This guide takes that number apart by vehicle type so you can compare it with yours.
A note on wordingThis is not a "total cost of ownership": it leaves out parking, tolls, tickets and the time you lose. These are the six components AAA measures, with their figures and date. What is not here is not measured.
What makes up the average ($11,577 / year)
| Component | 2025 average | What you can control |
|---|---|---|
| Depreciation | $4,334 / yr | Almost all of it: a 3-year-old used car has already taken the biggest drop. It is the strongest financial argument for buying used. |
| Insurance | $1,694 / yr | Little. Compare every year and raise the deductible if you have savings. What changes by state, below. |
| Finance | $1,131 / yr | All of it: short term, big down payment, pre-approved rate. |
| Fuel | 13¢ / mile | Depends on the car and how you drive. A hybrid cuts it nearly in half. |
| Maintenance, repair and tires | 11.04¢ / mile | Depends on the brand and on doing it on time. See the maintenance schedule. |
| License, registration and taxes | $813 / yr | Almost nothing per year. The hit is the tax at purchase; see your state's section below. |
By vehicle type (cents per mile, AAA 2025)
| Type | ¢ / mile | At 15,000 mi / yr* | Quick read |
|---|---|---|---|
| Small sedan | 55.87 | ≈ $8,380 | The cheapest to own. Low depreciation, low fuel. |
| Hybrid | 63.94 | ≈ $9,590 | Pays back its premium through fuel if you drive in the city. |
| Subcompact SUV | 66.11 | ≈ $9,920 | The middle ground most people buy. |
| Medium sedan | 66.37 | ≈ $9,960 | More room than the small one for about the same cost. |
| Compact SUV | 68.53 | ≈ $10,280 | The best-selling segment; its cost reflects pricier insurance and tires. |
| Electric | 71.21 | ≈ $10,680 | Cheap fuel, high depreciation and insurance. Better if you charge at home. |
| Mid-size pickup | 79.11 | ≈ $11,870 | Capability you pay for every mile. |
| Medium SUV | 83.89 | ≈ $12,580 | Three rows, high fuel, high depreciation. |
| Half-ton pickup | 98.54 | ≈ $14,780 | The most expensive to own. If you don't tow, you are paying for capability you don't use. |
*Simple multiplication of AAA's per-mile figure by 15,000 miles, rounded. AAA calculates on a new car, five years and 75,000 miles, national average. A used car has less depreciation and finance cost, but more maintenance.
What changes in Arkansas
- Insurance. Insurance prices in Arkansas vary a lot by ZIP code, driving record and car. Ask for the price on the VIN before you buy.
- Tax at purchase. 6.5% state on new cars and on used cars of $10,000 or more. Used $4,000 to $9,999: 3.5% state. Used under $4,000: DFA collects no state sales tax. The reduced rate goes by the date of sale, not the date you register. Where applicable, city and county tax is added; confirm with the Revenue Office whether local tax applies to a used vehicle under $4,000. For a vehicle licensed for highway use the single-transaction cap still applies: on January 1, 2008 that cap was dropped for almost everything, but it was kept for highway vehicles, aircraft, watercraft and manufactured housing. DFA prints the cap amount ($2,500 per transaction) for watercraft, but does not print it for cars: confirm it at the Revenue Office. In a private sale you pay the tax at the Revenue Office when you register. With a trade-in only the difference is taxed. If instead of trading it in you sell your previous car yourself, the credit applies when the sale happens within 60 days before or after the purchase; but if you sell AFTER you have already registered the new car, the sale has to happen within 45 days of the purchase and you claim the credit as a refund, not at the counter. Handing a stolen or destroyed car to your insurer in exchange for a payment does not count as a sale, and neither does giving it away.
- Climate. Hot, humid summers wear out batteries, A/C and tires, and spring storms bring hail: park under cover when there is a warning. Winter can bring ice, especially in the north: check tires, wipers and coolant before the cold.
- Comprehensive coverage. It is what pays for hail, flood, fire and theft. If the car is worth anything, it is not optional.
How to use this before you buy
- Take the price you can pay and subtract day-one tax and fees.
- Find the vehicle type in the table and multiply the cents by your real yearly miles (look at your current car: the odometer doesn't lie).
- Get an insurance quote on the specific VIN. It is the line that surprises most.
- If the yearly total is more than you can sustain, step down a segment. A small sedan costs half what a half-ton pickup costs every year, not just on purchase day.
Keep your vehicle information together
Sources
- AAA — Your Driving Costs 2025 (fact sheet, September 2025)
- AAA — New vehicle costs drop to $11,577 (press release)
- DFA — Recent Changes in the Law (Act 1013 used-vehicle rates)
- DFA — Arkansas Department of Finance and Administration — Office of Motor Vehicle
This guide informs; it is not legal or financial advice, nor an offer, quote or appraisal. Every figure carries its source and date; check it is still current before you decide.
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