Buying a new car in Minnesota in 2025 comes with more than just a shiny set of keys– or key fobs. From insurance to maintenance to fuel, here’s what drivers can expect when it comes to the true cost of getting behind the wheel in the North Star State.
Minnesota is the Land of 10,000 Lakes, but it's also the land of over 7.23 million vehicles, both private and commercial, that are currently licensed to drive on the roads, highways, and interstates here in the Bold North, according to the U.S. Department of Energy.
As prices have been increasing lately, Minnesotans are holding onto their vehicles longer and longer these days. So, it's not a surprise to learn that the average vehicle age here in the Gopher State and across the country has increased again and is now at a record 12.6 years old, according to new data from S&P Global Mobility.
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But many Minnesotans *are* still purchasing new rides, however. In fact, according to data from Alliance for Automotive Innovation, Minnesotans spent over $9.7 billion on new vehicles in 2024, with 229,000 new cars, trucks, SUVs, minivans, and other vehicles rolling off dealers' lots last year.
And when it comes to the total cost of owning and driving a new car in 2025, a new report from AAA Minnesota has some good news: the overall cost is down in the Land of 10,000 Lakes this year.
According to AAA Minnesota, this year’s analysis shows that the total cost of owning and operating a new vehicle in our fair state is $11,577, or $964.78 per month, a $719 decline from 2024.
So what's behind these declining costs? AAA Minnesota says depreciation, lower finance charges, reduced fuel prices, and 'a shift towards more affordable vehicle options' have all contributed to that lower cost in 2025.
AAA Minnesota's annual cost of driving analysis showed the biggest cost decrease in the following categories:
Depreciation – The difference between a car's purchase price and its resale value is the most significant cost of vehicle ownership, AAA notes. This year, depreciation costs have decreased, with vehicles in the study losing an average of $4,334 in value per year compared to $4,680 annually last year, AAA said.
Finance charges are also down this year, at an estimated $1,131, down 15 percent compared to the cost of $1,332 last year, AAA reported.
Plus, there's less pain at the pump. The average fuel cost dropped to 13 cents per mile, a 12.8 percent decrease from last year. The average price per gallon for regular grade gasoline averaged $3.15 this year, down from $3.53 last year.
Gallery Credit: Sarah Jones
