Low-Cost Luxury Spurs Tough Decisions

Mercedes-Benz CLA-Class

2014 Mercedes-Benz CLA 250

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?


Find Used Cars in Your Area at CarGurus

Used BMW 1 Series
Used Audi A3
Used Lexus IS 250
Used Acura ILX
Used Cadillac ATS
Used BMW 5 Series
Used Mercedes-Benz E-Class


  1. During my automotive career I was lucky to be able to drive a very wide variety of cars and trucks, which included some very expensive models, a few upwards of $100K. And not just drive them, but put them through their paces on the track and a variety of handling courses.

    Know what I learned?

    I found little real value in these expensive cars compared to “regular” cars. Yes, they had a lot of buttons and features, but I had a hard time understanding how they translated into prices 30K higher. In addition, they almost always were inefficient, wasteful gas guzzlers.

    Ultimately, my conclusion was that these “luxury” vehicles are nothing more than ego boosters for the insecure. I sure wouldn’t be impressed by someone driving one to work— If I was an employer, I’d want smart people who spend their money wisely, not someone who likely incurs big debts to appear to live beyond their means.

  2. I would rather spend the 30k on a high-end model. You said it perfectly.. Who want’s a tiny 1-series when they could have a monster engine with performance (and luxury) upgrades? Luxury car owners take care of their cars, so I don’t expect to see dings and missed service appointments in a used luxury sedan fresh out of a lease, or after a short tenure of ownership. And on top of that, small sedans (especially autos like a 1-series) target women and less men. The target market is more specific, and that makes decisions easier for some consumers.

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