Low-Cost Luxury Spurs Tough Decisions
At some point in our lives, each of us must face The Decision.
For some, The Decision must be made immediately upon college graduation. For others, it doesn’t surface until later in life. But The Decision is unavoidable. Automakers know about The Decision and will do anything in their power to help you make the one they believe is right.
For them, the earlier The Decision is made, the more likely they are to earn a lifetime customer. That is why more and more luxury automakers are rolling out entry-level cars. Convince a 25-year-old to make The Decision, and many years of profitable upgrades await. The Decision, or course, is whether to spend money on an entry-level new luxury car or spend the same amount on a late-model, higher-end used car.
Let’s imagine a 25-year-old entering the professional work world for the first time. This guy or gal needs to impress friends and coworkers and show that the new job reaps real benefits. Rolling up in a Hyundai, no matter how new, just isn’t going to have the same effect as showing off a new Benz. So, if someone could buy a low-end Mercedes-Benz for the cost of a high-end Hyundai, the choice would be quite simple.
At least, that’s what many of today’s luxury automakers hope.
Hovering around the $30,000 mark are the BMW 1 Series, the Audi A3, the Lexus IS 250, the Acura ILX and the Cadillac ATS. All offer buyers entrance into a premium brand at an affordable price. This year, Mercedes-Benz will join the party by offering the CLA 250 at a price of $29,900.
Make no mistake, that’s a lot of money to spend on a small car, and options will quickly escalate the price. Buyers could either save a lot of money and opt for a similarly sized car from a non-luxury brand or get a lot more for their money by looking through the CarGurus used listings and purchasing a used car a few model levels up. Why buy a 1 Series when a 5 Series could be had? Instead of a new CLA 250, why not a used E-Class?
Logically, buying used and getting more for your money would make sense. A new car, though, is a powerful temptress that makes The Decision exceptionally difficult.
If you had $30,000 to spend, would you buy a new entry-level luxury car, or a used higher-end model?