People in America are now driving less than before. This is because the cost of driving is constantly increasing. According to a new report by CarBuzz, the prices of gas, car prices, insurance, and maintenance are skyrocketing. This is changing the way Americans drive. Let's understand this news, what is happening and how it is affecting people's lives.
CarBuzz's report says that in 2023, Americans drove an average of 13,500 miles. But now this figure has come down to around 12,000 miles. This means that people are traveling less distance. Many people now take out the car only for essential work. Some people are even using public transport or bicycle instead of car to go to office. A big reason for this is the increase in expenses.
When the pandemic came in 2020, gas prices had come down considerably. But now in 2025, gas prices are rising again. According to AAA, the average price of a gallon of gas is more than $3.50. In some states like California, it is reaching $5. This is a big expense for people who have to drive every day. Many families are now trying small tricks to save gas, such as driving at low speed or planning a route to complete multiple tasks at once.
Buying a new car is no longer as easy as before. According to Kelley Blue Book, the average price of a new car in 2025 is close to $48,000. This is too much for the average American family. The prices of old vehicles have also increased, because people are not able to buy a new car. Apart from this, the interest rates of car loans have also increased to more than 7%. This is increasing the EMI every month, due to which people think many times before buying a car.
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The cost of driving a car is not limited to just gas and EMI. Insurance prices are also increasing rapidly. Companies like Progressive and Geico have raised their premiums by 10-15% in 2024. Now the average American has to spend more than $2,000 annually for car insurance. Along with this, the cost of repair and maintenance of the car has also increased. The cost of changing a simple tire starts at $200. If there is a major breakdown in the car, then the bill can be of thousands of dollars.
Due to these rising expenses, Americans are trying to reduce their expenses. Some people are now carpooling, that is, many people travel together in the same car. This divides the cost of gas and parking. Many people are also looking at electric vehicles (EVs), as they do not cost gas. But the price of EVs is still high, and charging stations are not available everywhere. Even though companies like Tesla and Rivian are promoting EVs, common people are still hesitant to buy them.
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People living in cities are driving less because there are more public transport options. In cities like New York and Chicago, people are traveling by subway or bus. But for people living in small towns or villages, a car is necessary because there is no other way. In such a situation, it becomes more difficult for them to reduce expenses.
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CarBuzz's report shows that if prices continue to rise like this, people will drive less. This can also affect the auto industry. Companies like Ford and General Motors are already seeing a decline in sales. On the other hand, people are demanding cheap and fuel-efficient vehicles. The government is also trying to reduce gas prices and make EVs cheaper, but it will take time to see its effect.
Source: Wall Street Journal, Statista, CarBuzz
