As fuel prices rise, a typical consideration for those shopping for a new car or truck is good fuel efficiency, so as to save on gasoline costs (or the cost of other fuels such as diesel). Often the consumer is willing to pay a premium for a more fuel efficient vehicle, as the savings due to the lower fuel consumption would eventually offset the premium.
For example, many consumers will pay more for a technologically advanced, fuel efficient gasoline-electric hybrid auto, or other low emission or alternative energy vehicle, rather than buying a less expensive, conventionally powered auto with lower fuel efficiency. However, the fuel cost savings realized over the ownership of the vehicle may not necessarily compensate for the premium paid over the limited duration of ownership, depending on the cost of fuel, the distance driven on a regular basis, etc. Furthermore, the money saved on future fuel purchases must be discounted compared to the initial cost, given the time value of money. Although such choices aren't always driven by financial cost alone, as lower gasoline consumption is considered to have other political and environmental benefits, knowing the total cost of ownership of a vehicle is important for any consumer considering a vehicle purchase.
Given an average monthly driving distance and the cost of fuel per gallon, this utility will generate a cost comparison between two vehicles with different initial costs and fuel efficiencies. Specifically, it will calculate the total cost of ownership (initial cost plus recurring fuel cost) of the two vehicles over different time horizons, in time discounted dollars. Also, it will calculate "break-even" point in time, when the total costs between two vehicles are approximately equal (and when the more fuel efficient vehicle's total cost drops below that of the less fuel efficient vehicle, due to cumulative fuel cost savings). If you only wish to analyze the total cost of a single vehicle, however, simply leave the cost and mileage entries for vehicle B blank.
Note that this tool only considers the initial cost plus an average fuel cost in the total cost calculations - it does not consider other costs such as maintenance, insurance, taxes, resale value, etc. Also, it relies on average driving distances and fuel efficiencies, so actual results will vary from this simplified scenario.
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