Luxury Car Buying Guide

For some buyers, the ultimate reward for a lifetime of hard work is to treat themselves to a fancy car. Maybe you've spent the past 20 years or so driving a family-friendly SUV, and, with the "kid" finally on their own, it’s time for a special ride. Or perhaps an upscale model has been earned through a successful career, or it will serve as a retirement cruiser. Luxury vehicles come in all shapes and sizes, with choices ranging from coupes and convertibles to sedans and SUVs. Even high-end versions of the Ford F-150, GMC Sierra Denali, and Ram 1500 could be considered "luxury" trucks. This ensures that there is a luxury model to serve a wide range of customers, no matter what drove them to seek a premium vehicle.

Buyers can expect the latest advancements in comfort, performance, safety, and technology in a luxury model, with many innovations starting on upscale models before migrating to mainstream vehicles. It is clear that automotive luxury today means so much more than just fancy leather upholstery and wood trim.

Luxury Car Types

At the entry point of the luxury-vehicle range reside models such as the Acura Integra, Kia Stinger, and Volkswagen Arteon, as well as premium brands’ smallest models, such as the Audi A3, BMW 2 Series, and Mercedes-Benz A-Class and CLA. These cars bridge the gap between mainstream cars and true luxury vehicles. Despite premium badges and higher prices, some models may be missing features found on a well-equipped, less expensive mainstream car.

Ramping up in pricing, the BMW 3 Series has reigned as one of the top performers in CR’s testing for decades. It’s joined by the Acura TLXAudi A4, Cadillac CT4 and CT5, Genesis G70, Infiniti Q50, Jaguar XF, Lexus IS, Mercedes-Benz C-Class, Tesla Model 3, and Volvo S60. Many of these models have two roomy front seats but fairly cramped rear seats.

Their larger counterparts embody the definition of true luxury . . . and steadily increasing prices. A few notable models include the Audi A6 and A8, BMW 5 Series and 7 Series, Genesis G80 and G90, Lexus ES and LS, Mercedes-Benz E-Class and S-Class, Polestar 2Porsche Taycan, Tesla Model S, and Volvo S90. These exclusive chariots bring greater levels of interior room, ride comfort, quietness, performance, and refinement. Some ultraluxury models have quite long wheelbases (the distance between the axles) that enable limo-like rear-seat space.

We’ve seen top-shelf sedans like these evolve from being almost exclusively offered with diesel and V8 powertrains to now being available with hybrid, plug-in hybrid, or all-electric propulsion, like the Teslas and Taycan. Mercedes-Benz joins the EV sedan market with its new EQE and EQS, based on the company's E- and S-Class, respectively.

What you’ll spend: The least expensive entry point in this category is about the mid-$30,000 range. But expect to be in the $40,000s before long—especially for popular models like the BMW 3 Series and C-Class. The least expensive long-range Tesla Model 3 is about $45,000. Dipping a toe into the pool of the top-notch models here will set you back anywhere from around $46,000 for a midlevel Lexus ES 350 to well over $100,000 for the best from Audi, BMW, Lexus, Lucid, Mercedes-Benz, Porsche, and Tesla.

Luxury SUVs also run the gamut from small to jumbo. Some of the compact and small players include the Acura RDX, Audi Q3, BMW X1 and X2, Buick Encore and Encore GX, Cadillac XT4, Genesis GV70Infiniti QX50, Land Rover Range Rover Evoque, Lexus NX and UX, Lincoln Corsair, Mercedes-Benz GLA and GLB, Porsche Macan, Tesla Model Y, and Volvo XC40. These are comfortable for two occupants, snug for four, and downright tight if a fifth adult comes along for the ride. Likewise, carrying cargo is limited by the vehicles’ compact proportions. Many of these smaller models deliver agile handling and return fuel economy in the low to mid-20s mpg.

Moving up to the midsized SUV category brings more room but also higher prices. Some models include the Acura MDX; Audi Q5; BMW X3; Buick Enclave; Cadillac XT5; Genesis GV80Infiniti QX60Land Rover Defender, Discovery Sport, and Velar; Lexus GX and RX; Lincoln Nautilus; Mercedes-Benz GLE; Porsche Cayenne; and Volvo XC60. The Audi E-Tron and Jaguar I-Pace come with all-electric powertrains. And more are on the way.

Over the past several years, some manufacturers have brought out coupelike SUVs—that is, they have a swoopy rear roofline that makes them look like coupes, but they retain four doors and are still classified as SUVs. The Audi Q8, Mercedes-Benz GLE Coupe, and Porsche Cayenne Coupe are a few of these rare examples.

Full-sized luxury models are at the top of the money-is-no-object food chain in the world of SUVs. Some examples include the Audi Q7 and Q8, Cadillac Escalade and XT6, Infiniti QX80, Land Rover Range Rover and Range Rover Sport, Lexus LX, Lincoln Aviator and Navigator, Mercedes-Benz GLS, Tesla Model X, and Volvo XC90.

Some of the midsized and larger models have three rows of seats to accommodate up to eight people. Like many luxury sedans, hybrid, plug-in hybrid, and all-electric powertrains are gaining traction, but traditional V6 and V8 engines remain the most prevalent.

What you’ll spend: Prices for the always popular luxury SUV crowd run the gamut from mid-$30,000s to around $100,000. For many of the rich and famous, nothing less will do.

Sporty Luxury Cars
Sporty luxury cars also span a wide range, from coupes such as the Infiniti Q60 to grand touring convertibles like the Jaguar F-Type. While this car type is less popular than it once was, many highbrow manufacturers still sell them. Audi, BMW, Lexus, Mercedes-Benz, and Porsche all compete in this segment.

Sporty luxury cars tend to favor a rear-wheel-drive configuration to aid performance dynamics, but many are available in all-wheel drive. A range of four-cylinder, V6, and V8 powertrains is offered. Some even offer hybrid and fully electric systems.

You can expect sporty luxury cars to have nicely finished leather and wood interiors, the latest electronic features, and engaging driving experiences.

Some may trade ride comfort, interior room and access, or visibility for better cornering ability, increased performance, or stylish exteriors.

What you’ll spend: None are inexpensive. These models might run you between $50,000 and over $100,000.

What Luxury Car Buyers Should Consider

The larger sedans and three-row SUVs all are spacious enough to function as good day-to-day commuter cars and family vehicles. The smaller sedans and coupes trade sporty driving for tiny back seats. However, given that these are in the luxury segment, expect to see the availability of heated and cooled seats, and driver’s seats with multiple power adjustments. Some models, like those from Mercedes-Benz, offer a massage feature for front passengers. Talk about luxury!

Engines and Fuel Economy
Four-cylinder engines, many with turbochargers, are the most common entry-level engine for these cars. Powerful V6 and V8s come with the fanciest models. Keep in mind that many of these models require premium fuel. 

Most luxury cars come exclusively with an automatic transmission, usually offering between six and nine speeds. More speeds (gears) in a transmission can help a car get better fuel economy without sacrificing performance. Many luxury-car transmissions allow manual shifting, typically through paddles mounted on the steering wheel, giving the cars a more performance-oriented feel when desired. Manual transmissions are few and far between and are generally limited to smaller and sportier models.

Hybrid systems, once relegated to near-fringe economy cars, are now widespread in almost every luxury segment. The fuel-economy champion here is the Lexus UX250h hybrid SUV, which returned 37 mpg overall in CR’s tests. On the other end of the spectrum, the V8-powered Cadillac Escalade came in at just 16 mpg.

Electrified models, whether full electric or plug-in hybrid, are getting much more popular. Tesla is the best known here, but pure electric vehicles from Audi and Porsche have been gaining ground, and entries from Cadillac, Lucid, and others will soon join the market. The all-electric models are usually good for 200 to 300 miles of driving in between charges. The recently tested Ford Mustang Mach-E delivered 270 miles of cruising range.

Cargo and Towing
Trunk sizes vary widely by model. Some sedans can accommodate a week’s worth of groceries with room left over. On the other hand, the coupes and convertibles have barely any cargo space at all. SUVs also vary widely as to how much stuff they can haul.

Most luxury SUVs have tow ratings of 3,000 pounds for small car-based crossovers to more than 8,000 pounds for traditional truck-based vehicles.

Safety and Advanced Driver Assistance Systems Technologies
Consumer Reports’ safety ratings include assessments of crash-avoidance capabilities and crash-test results, based on tests performed by the federal government and insurance industry. Further, our road tests detail issues regarding child seat installation and headlight performance.

Forward collision warning (FCW), automatic emergency braking (AEB) with pedestrian detection, and blind spot warning (BSW) are crash-avoidance technologies that CR believes should be standard on all vehicles. These should be on the next new or used model you buy.

FCW technology provides a visual, audible, and/or tactile alert to warn the driver of an impending collision with a car or an object directly in its path. AEB responds to an imminent collision, braking if the driver does not react in time. BSW monitors a vehicle’s flanks, warning the driver that another vehicle is alongside, where it may be difficult to see.

Other modern safety advances include telematics systems that can alert emergency personnel if an airbag deploys, such as GM’s OnStar service; lane departure warning systems that sound an alert if the driver changes lanes without signaling; lane keeping assist to maintain the vehicle’s position in the lane if the driver starts to drift; and rear cross traffic alert, which monitors the sides of the vehicle when the driver is backing out of a parking spot and can even apply the brakes if needed. (Learn more about car safety.)

The Tesla Model S.
Tesla Model S

Choosing Between a New and a Used Luxury Car

Like with any type of car, the first decision to make in choosing the right one: Will you buy new or used?

Buying a brand-new luxury car certainly has its benefits. New models have the very latest safety gear and engineering improvements, not to mention a bumper-to-bumper factory warranty. With a new vehicle, you know what you’re getting; you don’t have to worry about potential service problems or concealed collision damage. Further, you can have your choice of color, trim line, and option level. And financing rates are typically lower than for a used vehicle.

The crucial drawback with buying a new one is rapid depreciation. A new car can shed a third or more of its value in its first two or three years on the road. If you finance the new car with a low down payment, you can easily find yourself “upside down” on the loan, where you owe more than the car is worth.

Used cars can be a welcome alternative. The used-car market is about three times the size of the new-car market, so there are certainly plenty of choices. A 2- to 3-year-old car has already taken its biggest depreciation hit and should have the majority of its useful life ahead of it. Modern cars, if soundly maintained, can run for 200,000 miles or longer. Material and corrosion resistance improvements mean rust isn’t nearly as big a problem as it was years ago.

Again, focus on reliability when selecting a good new or used car, even if the vehicle is still covered by its original factory warranty. Check with Consumer Reports to find those that have top-notch reliability scores. (See our guide to car reliability.)

Browse the Consumer Reports Used Car Marketplace.

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