Automotive Research

Ride-hailing vs. vehicle ownership: Which is cheaper?

A man hails a ride-hailing car with a phone

The rise of ride-hailing services like Uber and Lyft has made it easier than ever to get around in urban areas—so easy that some people are forgoing car ownership and using ride-hailing exclusively.

A new AAA analysis has found that for the average driver in an urban area, however, traveling solely via ride-hail would cost $20,118 annually—more than twice the cost of owning a vehicle. How do they compare, and how much do ride-hailing costs vary between cities?

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Owning a car is cheaper, even with fuel, parking, & insurance

AAA's analysis began with the fact that vehicle owners who live in the city drive an average of 10,481 miles a year. Adding in the costs of fuel, insurance, and the purchase of  the vehicle (but excluding parking costs), AAA found that the average cost for an urban driver of a mid-sized sedan is $7,321 per year.

Parking expenses vary widely by city; AAA looked at 20 urban areas and found that the average cost of parking was $2,728 annually, making the full cost of vehicle ownership $10,049 per year. The lowest average annual cost for flat-rate parking was in Phoenix ($706) and the highest was in New York City ($8,088).

The average cost, time, & distance of a ride-hail trip

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Distance

6.6 miles

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Cost

$13.15

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Duration

15.1 minutes

The cost to travel exclusively via ride-hail for a year

Boston

$27,545

Nashville

$23,201

Philadelphia

$22,020

Chicago

$26,397

San Francisco

$21,972

New York City

$21,279

Cleveland

$20,091

Austin

$19,821

Pittsburgh

$18,940

 

Los Angeles

$17,951

Atlanta

$17,741

 

Dallas

$16,944

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Ways to help minimize the cost of car ownership

Buy (gently) used: The single biggest cost of car ownership isn't gas, maintenance, or insurance—it's depreciation, a car's loss in value over time as it gains age and mileage. Buying a pre-owned vehicle means avoiding some of that depreciation cost. Safe, reliable used vehicles are available at most price points.

 
Don't skimp on maintenance: It's counter-intuitive, but regularly spending a little money to keep your vehicle in good working order may save you in the long run by helping to prevent larger, more expensive repairs.

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Slow down: AAA research has shown that driving at high speeds has a profoundly negative impact on fuel economy. When gas is expensive, slowing down can save money. Learn more about the impact of driving habits on fuel economy.
 
Don't overspend on gas: If your car doesn't specifically require premium or mid-grade gasoline, don't spend extra to get them: there's no benefit. Learn more about what premium and mid-grade gas are (and aren't), and which vehicles need them.

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Looking for a new or used car?

AAA Car Buying Service has you covered. You can find the car you want and feel confident in the price you’re paying.1

Learn more

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