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Depreciation Drives TCO Increases in Q4

According to Vincentric, fleet costs per mile for most vehicle categories increased slightly in the fourth quarter, tempered by falling fuel prices.

Chris Brown
Chris BrownAssociate Publisher
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January 10, 2024
Depreciation Drives TCO Increases in Q4

Ownership costs for the pickup category crested the $ .90-per-mile mark for the first time, then cooled to end the year. Car and SUV costs have been less volatile over the past few quarters with an overall moderate rise.

Photo: Vincentric

2 min to read


Welcome to the latest installment of Fleet Data Depot, which provides snapshots of information, trends, and analysis relevant to the fleet market.

The total cost of ownership experts at Vincentric deliver another quarterly update on per-mile ownership costs for fleets over the previous 12 months. These fleet cost-per-mile calculations are for the fourth quarter of 2023. 

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This analysis is based on vehicles driven 20,000 miles per year for three years. As usual, Vincentric calculates its standard eight cost elements: depreciation, financing, fees and taxes, fuel, insurance, maintenance, opportunity cost, and repairs.

Ownership costs for luxury passenger cars and SUVs have been on an uneven yet steady rise over the past few quarters, with average costs per mile now at or close to all-time highs.

Photo: Vincentric

Cost Per Mile Increases   

The fleet costs per mile for most vehicle categories increased slightly in the fourth quarter of 2023, though the Passenger Cars and Pickups categories remained the same:

  • Luxury Car: increased by ~2.4%

  • Luxury SUVs: increased by ~1.8%

  • Passenger Cars: 0% change

  • Pickups: 0% change

  • SUVs: increased ~1.2%

The fourth-quarter data contrasts with the third quarter, in which costs for most vehicle categories decreased slightly, though the Pickups and SUVs categories remained the same over the previous quarter. 

The increases in cost per mile were primarily caused by increases in depreciation costs, which ranged from 6% to 7% higher on average in the quarter compared to the previous quarter. According to Vincentric, the increase is likely primarily due to the high number of MY24 vehicles it has received from its data provider since last quarter.

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Although depreciation costs increased, Vincentric noted that fuel costs for all segments decreased by 7% to 10% compared with the third quarter. 

To understand up-to-date lifecycle costs and fleet incentives based on model and class, visit here.

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