Posts Tagged ‘repair affordability’

Gas Prices Remain Stable Amid the Aftermath of Hurricane Florence

September 17th, 2018 by AAA Public Affairs

While Hurricane Florence battered the Carolinas over the weekend with life-threating storm-surge, rain and flooding, it has had little to no impact on gas prices, with the national average, holding steady at $2.85 on the week.

Gas prices have not seen much movement because unlike the Gulf Coast, which is home to dozens of refineries, the Carolinas house only pipelines and terminals. This means U.S. crude processing is not impacted and therefore neither are gas prices nationally.

Prior to Florence’s arrival, the Energy Information Administration (EIA) reported the Lower Atlantic Region’s total gasoline stocks — which includes West Virginia, Virginia, North Carolina, South Carolina, Georgia and Florida — measured at 27.9 million bbl. That is 10 percent higher than the 5-year average for this time of year.

“Gasoline stocks in the hurricane-impacted area are healthy, but delivery of gasoline will be an impediment to meeting demand in coastal areas this week,” said Jeanette Casselano, AAA spokesperson. “As power is restored, water recedes and roads open-up, we will have a better idea of how quickly fuel deliveries can be made to gas stations in the area. And while fuel availability at stations is a concern, AAA expects station outages to be short-lived.”

According to the Department of Energy, states are working closely with industry to expedite resupply shipments to impacted areas. AAA will continue to monitor hurricane recovery efforts and fuel resupply.

  • The nation’s top 10 least expensive markets are: Alabama ($2.52), Mississippi ($2.54), Arkansas ($2.57), Louisiana ($2.58), Tennessee ($2.59), South Carolina ($2.60), Missouri ($2.60), Texas ($2.60), Virginia ($2.62) and Oklahoma ($2.64).
  • The nation’s top 10 largest monthly changes are: Colorado (+10 cents), Indiana (-6 cents), Delaware (+6 cents), Florida (-5 cents), South Carolina (+5 cents), Louisiana (-4 cents), Alaska (-4 cents), Utah (-4 cents), Iowa (+4 cents) and California (+4 cents).

Mid-Atlantic and Northeast

Hurricane Florence drove up gas prices in North Carolina (+3 cents) and Virginia (+1 cents) this past week. All other states in the Mid-Atlantic and Northeast region saw prices decrease by a few cents or remained stable.

For motorists in coastal parts of North Carolina and Virginia, fuel availability post Hurricane Florence is a concern. As residents evacuated, panic-buying and tank-topping set-in, leaving some gas stations with low to no fuel at their pumps. The positive news is that Mid-Atlantic and Northeast regional gasoline inventories sit at a healthy 66.7 million bbl, which is not only the second highest inventory level recorded for the region this year, but a level not seen in the Mid-Atlantic and Northeast region since March 2016. This means that the region has adequate supply on-hand, and, weather-dependent, could be a resource to assist with resupply in the hurricane-impacted area, once water levels subside, roads are passable and power is restored.

South and Southeast

Hurricane Florence pushed up South Carolina’s ($2.60) state gas price average by just a penny on the week. Otherwise, pump prices for the majority of the South and Southeast are getting cheaper or seeing no change. Florida saw the largest drop of 3-cents during the last seven days while a one-cent drop was seen in Texas, New Mexico and Louisiana.

Pipelines and terminals are located in South Carolina, but were unaffected by the storm. Those facilities deliver approximately 3 million b/d of refined products to the eastern U.S. Once delivery trucks are able to take to the roads, the South and Southeast pipelines and terminals will help with resupply to the coastal areas.

As Gulf Coast refineries have not been impacted by the hurricane, processing continues as normal. South and Southeast gasoline inventories built by 600,000 on the week, according the EIA’s latest report. Total inventories measure at 81.2 million bbl, which is a healthy level for this time of year.

Great Lakes and Central

As area refineries undergo maintenance, state gas price averages in the Great Lakes and Central region are as much as five-cents more expensive since last Monday: Iowa (+5 cents), Nebraska (+4 cents), Ohio (+4 cents), and South Dakota (+3 cents). Only Missouri ($2.61) and Kansas ($2.66) saw a drop in pump prices on the week.

Today, there is a 32-cent difference in the most expensive state gas prices in the region carried in Michigan at $2.93 and least expensive at $2.61 in Missouri.

As pump prices see relatively small volatility, gasoline inventories continue to hover at the 53.1 million bbl mark. However, with unplanned and planned maintenance at some Great Lakes and Central refineries, inventories could decline this fall.

Rockies

On the week, Utah (-2 cents) and Idaho (-1 cents) motorists are paying less to fill-up. In fact, gas price averages across the Rockies states are mostly moving toward a return to pre-summer pump prices. Here is a snapshot of state gas prices since Memorial Day, at their highest summer price and today’s price:

  State gas price average on May 24, 2018 (start of Memorial Day Weekend) Highest gas price average this summer by state State gas price average on September 17, 2018
Colorado $2.89 $2.91 $2.91
Idaho $3.17 $3.26 $3.21
Montana $2.91 $2.95 $2.95
Utah $3.15 $3.21 $3.13
Wyoming $2.87 $3.00 $2.98

As demand begins to drop in the region, gasoline inventories took a small draw and continue to hover near the 6.5 million bbl mark. Gas prices will continue to trend cheaper as demand draws into the fall.

West Coast

The West Coast remains the nation’s most expensive region for retail gasoline, with six of the region’s states represented in the nation’s top 10 most expensive list. Hawaii ($3.77) is the nation’s most expensive market, followed by California ($3.64), Washington ($3.38), Alaska ($3.31), Oregon ($3.26), Nevada ($3.20) and Arizona ($2.87). Prices in the region remain relatively flat compared to last week, except for a one-cent jump in California and Arizona.

The EIA’s weekly petroleum status report showed West Coast motor gasoline stocks totaled 28.4 million bbl during the week that ended on September 7 – a gain of 100,000 bbl from the previous week. Stocks are 1.3 million bbl lower than where they were at this time last year, which could support a price spike if supplies remain low amid an increase in demand.

Oil market dynamics

At the close of Friday’s formal trading session on the NYMEX, WTI increased 40 cents to settle at $68.99. Oil prices have edged higher last week following the release of the EIA’s weekly petroleum report that showed crude stocks fell by 5.3 million bbl last week. If supplies fall again in this week’s report, crude prices could climb further. Dwindling supplies have put a spotlight on shrinking global crude inventories, which could cause oil prices to push to $70-$80/bbl this fall. Continued decline in crude production from Venezuela and anticipated reduced crude exports from Iran due to U.S.-imposed sanctions that go into effect in November could place greater pressure on the market. In the near term, U.S. crude production has not been impacted by Hurricane Florence, as there were no refineries in Florence’s path.

Motorists can find current gas prices along their route with the free AAA Mobile app for iPhone, iPad and Android. The app can also be used to map a route, find discounts, book a hotel and access AAA roadside assistance. Learn more at AAA.com/mobile.

AAA: New Cars Lose $3,000 Annually from this Single Expense

September 13th, 2018 by AAA Public Affairs

Drivers should keep resale value top of mind when buying a new vehicle

ORLANDO, Fla. (Sep. 13, 2018) – AAA’s 2018 Your Driving Costs study reveals the largest expense associated with purchasing a new car is something many drivers fail to consider – depreciation. In fact, it accounts for almost 40 percent of the cost of owning a new vehicle – more than $3,000 per year – and is influenced by a number of factors, including shifting consumer preferences. AAA urges car buyers to think about both market trends and length of ownership when shopping for their next vehicle purchase. 

“New vehicles offer the latest designs, cutting-edge technologies and warranties that offer peace of mind,” said John Nielsen, AAA’s managing director of Automotive Engineering and Repair. “But, car owners that like to change vehicles frequently should be thinking about the resale value – not just the purchase price – when choosing their next ride.”

Additional Resources

AAA’s annual analysis found demand for sedans has slipped as American appetite shifts to SUVs and pickup trucks. As a result, depreciation costs of these once-popular vehicles increased up to 13 percent as compared to last year. Electric and hybrid vehicles, however, have seen a gain in popularity with 20 percent of Americans saying they will likely go electric for their next vehicle purchase, up from 15 percent the previous year. This year, these vehicles also saw a dip in depreciation and offer many cost benefits such as lower repair and maintenance bills, making going green a more affordable choice than in years past.

Buyers often only give priority to purchase price and monthly payment when choosing a new car, sometimes selecting a vehicle based on the best deal available. The length of car ownership, however, is of equal importance. Consumers who plan to keep a vehicle for only a few years should be cautious of deep discounts and incentives offered by automakers and dealers. These are often designed to sell less popular models and directly influence depreciation. Low down payments and extended finance terms can also have a similar effect. Stretching a car loan over five, six or even seven years may be an effective way to lower payments, but owners may quickly find themselves owing more than the vehicle is worth.

Leasing is similarly affected since payments are based in part on the projected residual value of the car at the end of the lease, serving as a good indicator of which models experience higher or lower depreciation. Since resale value is not a factor at the end of the lease period, buyers who prefer less popular models or only want a vehicle for a short time, may consider leasing a more viable option.

“The secret to minimizing depreciation costs?” continued Nielsen. “Keep your car for a long time and keep it well-maintained or even consider buying a quality, pre-owned vehicle.”

AAA’s Your Driving Costs found the average cost to own and operate a new vehicle in 2018 is $8,849 per year. The figure is calculated based on the cost of fuel, maintenance, repairs, insurance, license/registration/taxes, depreciation and loan interest. The study examined 45 top-selling 2018 model-year vehicles across the following nine categories.

Vehicle Type Annual Cost*
Small Sedan $6,777
Hybrid $7,485
Small SUV $7,869
Electric Vehicle $8,384
Medium Sedan $8,866
Minivan $9,677
Medium SUV $9,697
Large Sedan $9,804
Pickup Truck $10,215
Average $8,849

*Based on 15,000 miles driven annually

While the latest technology, style and options make them attractive to car buyers, a new car may not be the most economical choice for some buyers. Vehicle owners looking for alternatives to new car ownership or ways to minimize their operating costs should consider the following:

  • Buy (gently) used – 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 grade 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 cleaner and longer, consider switching to synthetic oil and upgrading to a higher quality fuel TOP TIER™ gasoline.
  • Slow down – When gas prices are high, small changes in the way you drive can make a big difference.

AAA’s Your Driving Costs study employs a proprietary methodology to analyze the costs of owning and operating a new vehicle in the United States, using data from a variety of sources, including Vincentric LLC. Additional information and detailed driving costs, including those for fuel, maintenance, repairs, insurance, license/registration/taxes, depreciation and finance charges can be found at NewsRoom.AAA.com or AAA.com/YourDrivingCosts.

As North America’s largest motoring and leisure travel organization, AAA provides more than 59 million members with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for the safety and security of all travelers. Motorists can map a route, identify gas prices, find discounts, book a hotel and access AAA roadside assistance with the AAA Mobile app for iPhone, iPad and Android. Learn more at AAA.com/mobile. AAA clubs can be visited on the Internet at AAA.com.

 

AAA advises drivers to save $50 per month for car care fund

ORLANDO, Fla. (April 4, 2017) – According to a new AAA survey, 64 million American drivers would not be able to pay for an unexpected vehicle repair without going into debt, indicating that some drivers may underestimate the full cost of owning and operating a vehicle. Because some car repairs are unavoidable, and the average repair bill is between $500 and $600, AAA urges drivers to save at least $50 a month for unforeseen expenses, and identify a trusted repair facility before trouble strikes.

Additional Resources

“The average cost of owning and operating a vehicle is more than $8,500 a year, and AAA has found that millions of Americans are failing to set aside a car care fund to pay for the upkeep of their cars,” said John Nielsen, AAA’s managing director of Automotive Engineering and Repair. “To avoid a surprise down the road, drivers should budget for monthly payments, insurance premiums, fuel costs and the inevitable expenses of routine maintenance and repair.”

Although an average repair bill can set a driver back up to $600, the cost can soar higher when a vehicle has been poorly maintained. A previous AAA survey found that one-third of U.S. drivers skip or delay recommended service or repairs, which increases the likelihood of unexpected mechanical failures and leaves a vehicle more vulnerable to roadside breakdown. In 2016 alone, AAA responded to nearly 32 million stranded motorists.

“Anticipating your vehicle’s needs before problems strike is important,” continued Nielsen. “While it may seem that skipping maintenance and repairs can save money in the short term, staying on top of car care can save drivers hundreds of dollars in the long run.”  

Before a breakdown happens, AAA recommends that vehicle owners:

  • Follow the manufacturer’s recommended maintenance schedule to avoid roadside trouble.
  • Identify a repair shop you trust. A recent AAA survey found that one-third of U.S. drivers have yet to find a trusted repair facility. Visit com/autorepair to locate a AAA Approved Auto Repair facility near you.

If faced with an unexpected repair, AAA suggests that drivers:

  • Get a written estimate for the repair and clarify with the shop the work that needs to be done on the vehicle Consider getting a second opinion to confirm the diagnosis.
  • Negotiate the repair bill with the mechanic. Ask if the shop offers any discounts or payment plans that can reduce immediate out-of-pocket costs.

The AAA Approved Auto Repair (AAR) network consists of nearly 7,000 facilities that have met AAA’s high standards, including, technician certifications, ongoing training, financial stability, facility cleanliness, insurance requirements, rigorous inspections and customer satisfaction. AAA members are eligible for special benefits at AAR facilities, including priority service, a 24-month/24,000-mile warranty, discounts, free maintenance inspections, dispute resolution assistance and more. To locate an AAR shop in your area, visit AAA.com/autorepair.

As North America’s largest motoring and leisure travel organization, AAA provides more than 57 million members with travel, insurance, financial and automotive-related services. Since its founding in 1902, the not-for-profit, fully tax-paying AAA has been a leader and advocate for the safety and security of all travelers. Motorists can map a route, identify gas prices, find discounts, book a hotel and access AAA roadside assistance with the AAA Mobile app for iPhone, iPad and Android. Learn more at AAA.com/mobile. AAA clubs can be visited on the Internet at AAA.com.

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