When it comes to luxury cars, one must consider additional factors when deciding whether to buy new or used. High-end models are often a brand's showcase for its latest and greatest technology, so while a used luxury car may have features that were on the cutting edge just a few years ago, those same features may be commonly available on brand-new mainstream cars (and at comparable prices). Older luxury cars can be more complex and expensive to repair, so be sure to check our reliability scores carefully.
That said, a reliable used luxury car is a great way to treat yourself, providing above-average comfort and cachet at a similar price to a brand-new mainstream car. The first thing you need to weigh is the value of having more prestige for less money versus having a comprehensive factory warranty and the ability to really know what you're getting. When buying new, you don't have to worry about potential service problems or concealed collision damage with a new car. Further, you can have your choice of color, trim line, and option level. And financing rates are typically lower than for a used vehicle.
Beyond the high prices, the key drawback to buying a new luxury car is rapid depreciation. A new car can shed half of its value in its first two or three years on the road, amounting to tens of thousands of dollars for some luxury cars. If you have financed the new car with a low down payment, you can easily find yourself owing more than the car is worth.
If you decide on a used car, you should have plenty of choice. The used-car market is about three times the size of the new-car market. And most luxury-brand automakers offer certification programs that provide some significant warranty protection.
One of the best strategies is to find a luxury car that's only two to three years old. Such a car has already taken its biggest depreciation hit and should have the majority of its useful life ahead of it. Many luxury cars are leased, which means there is a good supply of two- to three-year-old cars with relatively low mileage. Modern cars, if soundly maintained, can stay on the road for 200,000 miles or longer. Rust isn't nearly as big a problem as it was years ago, and solid-state electronics have eliminated the need for frequent tune-ups.
The key to selecting a good used vehicle is to focus on reliability, even when a prospective automobile is still covered by its original factory warranty. Look for a car that has done well in our Reliability judgments.
CR's reliability scores are no guarantee, of course, but they do carry the weight of probability. If you shop for luxury cars with top-notch reliability scores, the odds are on your side. At the same time, every used car is unique. A careful pre-purchase inspection remains a vital part of the process. If you do your homework and take care in the car selection, a used luxury car can save you significant money in the long run.
Whether buying new or used, it is important to do research so you can choose a good model, and follow that up with effective negotiation.
Learn more in our new and used car buying guides.
Check our Car Brand Report Cards to learn more about each automaker.