Key takeaways: 

• Consumers spend an average of $838 on repair shop visits
• More drivers are keeping cars longer or using DIY maintenance to save on costs
• Building an emergency fund can help offset sudden repair expenses

Car repair costs are up more than 33% since 2021 with advanced technology, labor demands, and car ownership trends fueling the increase. Regular maintenance, comparison shopping, and an emergency fund can help drivers manage expenses.

For many Americans, the cost of maintaining or repairing a car is another reminder that inflation still lingers.

The latest Consumer Price Index (CPI) from August showed that car repair costs jumped 5% for the month and 15% year-over-year. The increase is more than 33% over the past 4 years, according to the Bureau of Labor Statistics.¹

The trend is being driven by several factors, including the complexity and advanced technology of modern vehicles, rising supply chain and labor costs, and drivers holding onto older models longer.²

An average trip to the repair shop costs drivers $838, according to Cox Automotive, but many major engine or transmission repairs can be much more expensive.^3,4 Collision repairs are also very costly, averaging $4,730 in 2024, according to industry data.⁵ 

Car owners are responding in different ways, with some tackling maintenance and repairs themselves.⁶ A well-built emergency fund can also help drivers stay on track when repair costs arise.

Read more: How much should you have in an emergency fund?

The cost of complexity: new technology and repair bills 

Modern vehicles have boosted safety, performance, and efficiency but the technology behind those advances can be expensive to fix. Many newer models now rely on complex electronic systems, onboard computers, and sensors tucked behind bumpers, windshields, and body panels.⁷

Advanced driver assistance features like blind-spot monitoring, automatic emergency braking, and parking assistance can be costly to fix because they require technicians with advanced skills and specialized diagnostic tools, even for minor problems like camera misalignment.⁸ 

A study by AAA found that repairs to advanced driver assistance features can add 37% to a repair bill.  Even minor damage to high-tech features like distance sensors can tack on $1,500 or more.⁹

Labor costs for increasingly complex car repairs are about 20% higher than before the pandemic and demand for qualified technicians can extend repair wait times.¹⁰

Another factor driving costs is the wider use of lightweight materials such as plastic and aluminum, which can be damaged or need replacement.¹¹ The amount of plastic in cars rose 16% from 2012 to 2021, according to the American Chemistry Council, to help offset the weight of increasingly heavier components like batteries, onboard technology, and infotainment systems.¹²

Aging vehicles also face higher maintenance costs 

Older models may be less complex, but they aren’t immune to costly repairs. As vehicles age, they can face risks of major, and more expensive, fixes such as transmission work, suspension replacements, or engine rebuilds.¹³

Empower research shows that 60% of Americans are keeping cars longer to save money. The average vehicle on the road rose to 12.7 years in 2024 and cars older than 7 years have been making up a larger share of car repairs since 2019.¹⁴

Tariffs are also complicating the picture since many after-market parts used in car repairs are imported and currently subject to 25% import duties.¹⁵ Some countries like Japan, South Korea, and those in the EU have reached deals with the U.S. for lower tariff rates.¹⁶

Some owners are rolling up their sleeves to save on labor costs. About 30% of drivers said they would attempt a self-repair in 2024, up from 26% in 2020. With help from video tutorials and online repair guides, they’re tackling minor fixes like broken bulbs and side mirrors while others are saving more on bigger jobs like replacing catalytic converters.¹⁷

Still others are simply putting off repairs. A 2024 Carfax report found that 20% of cars on the road are behind on oil changes and nearly 30% need tire rotations. It estimated that 30 million U.S. vehicles were behind on both services.¹⁸

• Drivers aren’t the only ones shifting habits. Costly or lengthy repairs have led insurance companies to write off more vehicles after accidents. The share of vehicles deemed “totaled” in collisions was 27% in 2023, up from 19% in 2018, a trend that can impact all drivers.¹⁹

Car insurance costs jumped about 20% in 2023 and 11% in 2024, according to the Bureau of Labor Statistics, but have stabilized more recently.²⁰ August CPI data showed a 4.7% bump year-over-year for auto insurance.

Read more: Premium prices: Typical family pays over $2K monthly for insurance

Maintenance, savings and strategies for consumers 

Drivers have tools to offset costs. One of the most effective ways to avoid major repair bills is to stay on top of routine maintenance. Addressing a small problem like low or dirty oil could prevent costly repairs like engine failure.²¹

Repair costs also can vary widely between dealerships, independent garages, and national chains. Getting multiple estimates and asking about aftermarket or used parts can help reduce expenses. Some shops are willing to offer coupons or discounts on repairs — if asked.²²

For those more comfortable under car hoods, some easier fixes like replacing batteries or air filters can be done with help from an auto parts store.²³ 

An emergency fund can provide a financial cushion for unavoidable expenses, with Empower research showing that 21% of Americans dip into those savings pools for sudden car repair costs. One in 5 (20%) worked with a financial advisor to set savings goals for emergency funds and establish a plan. Liquidity is also important, with 30% of savers stashing their funds in cash and 33% looking to grow emergency money in a high-yield savings account.