A recent study by the Journal of Consumer Research examined average insurance, repair, and fuel expenditures across the United States. The results place Mississippi among the most expensive states: the combined average cost of these three categories is $3,465, ranking it fourth highest nationally. When this figure is weighed against the state’s median income, it becomes clear that owning a vehicle imposes the greatest financial strain on residents in Mississippi.
What That Means for the Household Budget
Although the average share of a budget devoted to a car—6.4 %—might sound modest, it actually translates to more than $1 of every $16 earned being spent on vehicle-related expenses. Notably, this estimate excludes car payments or leases.
Breaking down the components:
- Insurance: On average, Mississippians pay $1,232 per year, a steep cost for many. This helps explain why over one in five drivers in the state remain uninsured.
- Repairs: Annual repair costs average $394, underscoring the sudden, unpredictable expenses that vehicle owners face.
- Fuel: With $1,838 spent yearly, Mississippi ranks second-highest in the country for gasoline costs.
These burdens are exacerbated by the fact that Mississippi households already grapple with some of the highest debt-to-income ratios and credit card usage rates in the nation, as reported by WalletHub.
New, Used Vehicle Prices and Auto Debt
Industry data from Experian indicates that a new car typically costs $47,962, whereas a used car averages around $25,180. In Mississippi specifically, WalletHub finds that median auto loan debt per borrower stands at $20,816. These figures intensify the pressure on consumers already coping with high operational costs.
The Role of the Auto Industry in Mississippi’s Economy
Despite substantial expenses for consumers, Mississippi’s automotive sector remains a powerhouse for the state’s economy. Per the Mississippi Development Authority (MDA):
- More than 200 auto-related manufacturers operate in the state
- These companies employ approximately 15,000 people
- Collectively, they produce half a million vehicles each year
Further supporting the ecosystem are numerous tire and vehicle component companies spread across the state, especially around the Jackson metropolitan area.
Conclusion
While car ownership in Mississippi poses a hefty financial burden—through steep insurance, repair, and fuel costs relative to income—the state’s automotive industry remains a vital contributor to employment and manufacturing output. The tension between high costs for consumers and the economic benefits of manufacturing underscores a complex reality for Mississippi’s car owners and its broader economy.
Frequently Asked Questions
What makes car ownership so costly in Mississippi?
High annual costs for insurance, fuel, and repairs, combined with relatively low median incomes and elevated debt loads, intensify the burden on vehicle owners.
Why do many drivers in Mississippi go uninsured?
Because insurance premiums average $1,232 annually, many find the costs prohibitive, contributing to more than one in five drivers being uninsured.
How significant is the auto industry in Mississippi’s economy?
Very significant: over 200 manufacturers in the state employ 15,000 workers and produce half a million vehicles annually, supporting numerous ancillary sectors across the state.
