Luxury Car Buying Guide

Luxury vehicles are available in sedan, coupe, convertible, and SUV body styles, and in a wide variety of sizes and shapes within those categories. 

What Makes a Luxury Vehicle

Luxury vehicles typically represent the leading edge of comfort, performance, safety, and technology, and a good luxury car has an innate quality that goes beyond leather upholstery and wood trim. Materials should be of a higher grade than those in mainstream vehicles, with plush carpets, rich fabric, and quiet cabins. Basic power amenities, automatic climate-control systems, and uplevel audio systems with Bluetooth connectivity are expected. Many luxury models also offer all-wheel drive and can be had in sedan, coupe, SUV, and convertible body styles.

What You Will Pay
Prices can run the gamut. For example, the Acura ILX, Audi A3, and Mercedes-Benz CLA are priced in the low $30,000s. From there, true luxury models can reach up to $200,000 and more. The most expensive car Consumer Reports has bought is the Tesla Model S P85D, $127,820, and the most expensive SUV we’ve tested is the Tesla Model X, $100,000.

Key Things to Consider
Luxury cars can be so comfortable and enjoyable that once you’ve experienced the luxe life, going back to a mainstream car feels like a major downgrade. But this exclusive driving experience comes at a price, literally, in the form of the initial purchase and subsequent ownership costs, both of which typically far exceed those of more humble vehicles. Before committing to a luxury model, realize that almost all of today’s mainstream models can be better equipped than luxury cars from just a few years ago. Many offer uplevel comfort and safety features that were once the exclusive domain of prestige-brand models. These well-equipped mainstreamers cost thousands less than luxury-branded models, although they may lack the thoroughness of design, special atmosphere, and prestige of a proper luxury car. Ultimately, how your money is best spent is an individual choice. Luxury cars tend to do very well in our tests because of their performance and comfort, but so do some well-appointed models from nonluxury brands.

When buying a luxury car, one must look carefully at the standard equipment list, especially on European cars, which sometimes offer little more than brand cachet in their lower-spec models. Features you might expect to come standard, such as metallic paint, genuine leather upholstery, and advanced safety equipment, may be offered as extra-cost options, and high-end, high-tech features are often bundled in expensive option packages. Most of these extras are priced far higher than similar features in mainstream cars, and we’ve seen several models that offer enough high-priced options to nearly double the price of the car. If you want to avoid option confusion, consider American and Japanese brands. They tend to offer a few trim levels and a minimum of options and packages. The German manufacturers take the opposite approach, with multiple versions or trim levels, plus extensive lists of options and packages.

Note, though, that some high-end features add more complication than real functionality. That said, the rapid advances in active safety systems are well worth your attention, because many of them are helpful (blind-spot monitoring, rear cross-traffic alert) and some are proven lifesavers (collision-mitigation systems). Once the lone purview of the luxury class, these systems are becoming widely available. It is best to try any unfamiliar features before putting much weight on them in your purchase decision. Your salesperson should be able to explain and demonstrate any features.

Luxury Comes in Different Shapes and Sizes
Midsized luxury cars and car-based SUV models, priced from $40,000 to $60,000, are generally a sweet spot in the market, offering driving enjoyment and interior refinement without the fussiness or large footprint of a large vehicle or the complexity of cutting-edge features.

Large and heavy V8-powered luxury models tend to also cost you at the pump. Hybrid, turbocharged, and diesel powertrains are offered in a growing number of luxury sedans and SUVs to improve fuel economy, although the hybrids and diesels often come at a significant price premium. Generally, this isn’t a category to explore if saving money is a primary goal.

Traditionally, most large luxury sedans employ rear-wheel drive. It is the preferred setup for ideal weight distribution, handling agility, ride comfort, and noise isolation. But rear-wheel drive is not the ideal setup for foul-weather driving, and many rear-drive luxury vehicles offer all-wheel drive as an option.

If you want a luxury car, deciding whether to choose a sedan, an SUV, or a sporty model depends on your needs and wants. You can turn to our buying advice for those types of cars to help you narrow it down. Each category has several good vehicles to choose from, but there are several models that don’t deliver on their luxury promise. Our ratings will help you see the difference.

What You’ll Spend
Entry-level compact luxury models are priced from the low $30,000s up to about $60,000 for a heavily optioned model. Midsized luxury models cover the range between $40,000 and $80,000, and large luxury cars start around the mid-$70,000s and run well into six figures, not counting the offerings from exotic brands.


At the entry point of the luxury-vehicle range reside models such as the Acura ILX and TLX; Audi A3; BMW 2 Series, 3 Series, and 4 Series; Buick Regal; Cadillac ATS; and Mercedes-Benz CLA and C-Class. These are smaller cars that bridge the gap between mainstream cars and true luxury vehicles.

Their larger counterparts, such as the Audi A6 and A8; BMW 5 Series and 7 Series; Cadillac CTS, CT6, and XTS; Genesis G80 and G90; Infiniti Q70; Lexus ES and LS; Lincoln MKZ; and Mercedes-Benz E-Class and S-Class, bring greater levels of interior room, ride comfort, quietness, performance, and refinement. In other words, true luxury.

Luxury SUVs also run the gamut from small to jumbo. The compact and small players include the Acura RDX, Audi Q3, BMW X1, Buick Encore, Infiniti QX50, Land Rover Range Rover Evoque, Lexus NX, Lincoln MKC, Mercedes-Benz GLA and GLC, Porsche Macan, and Volvo XC60. These are comfortable for two occupants, snug for four, and downright tight if a fifth adult comes along for the ride.

Moving up to the midsized category brings models such as the Acura MDX, Audi Q5, BMW X3, Cadillac XT5, Infiniti QX70, Land Rover Discovery and Rover Range Rover Sport, Lexus RX, Mercedes-Benz GLE-Class, and Porsche Cayenne.

Full-sized luxury SUV models include the Audi Q7, Buick Enclave, Cadillac Escalade, Infiniti QX80, Land Rover Range Rover, Lexus LX, Mercedes-Benz GLS, Toyota Land Cruiser, and Volvo XC90.

Luxury Sedans
Luxury sedans come in a range of sizes and flavors, ranging from compact sedans to long-wheelbase, limolike offerings, with every conceivable variation in between.

Some luxury sedans are available with hybrid or diesel powertrains, while the all-electric Tesla Model S is a pure electric vehicle.

Smaller, entry-level luxury models, such as the Acura ILX, Audi A3, Cadillac ATS, Lexus IS, and Mercedes-Benz CLA, often have two roomy front seats, but at the expense of the rear seats.

Larger models provide more room, but handling is often less sporty. At the largest end of the scale, several luxury sedans like the Audi A8 and BMW 7 Series offer stretched-wheelbase models over and above their standard lengths, bringing expansive legroom and boosting prices by at least $5,000, or they offer just a premium length, like the Lexus LS and Mercedes-Benz S-Class.

Luxury SUVs
Luxury SUVs range from small models such as the BMW X1, Buick Encore, and Mercedes-Benz GLA and GLC to very large truck-based models such as the Cadillac Escalade, Infiniti QX80, and Lexus LX.

Many of the smaller models are agile and luxurious yet return fuel economy in the low to mid-20s mpg. The largest models are typically ponderous to drive and struggle to achieve 16 mpg.

In between are the most popular models—midsized, car-based SUVs such as the Acura MDX, Audi Q5, BMW X3, Infiniti QX60, Lincoln MKX, Lexus RX, and Volvo XC90.

Some of these models, as well as all the large luxury SUVs, have three rows of seats to accommodate up to eight people. Some are also available with hybrid or diesel engines that can provide fuel economy in the range of some family sedans.

Sporty Luxury Cars
Sporty luxury cars also span a wide range, from a four-cylinder Audi A5 up to a supercharged Jaguar F-Type coupe or convertible.

Sporty luxury cars tend to favor a rear-wheel-drive configuration to aid dynamics, but many are available in all-wheel drive. At the lower end of the spectrum, there are some front-wheel-drive models as well.

You can expect sporty luxury cars to have nicely finished leather and wood interiors, the latest electronic features, and powerful engines that deliver strong acceleration.

Some may trade off ride comfort or interior room for better cornering ability, faster performance, or stylish exteriors.


Clearly, luxury cars come in a wide variety, and some are more luxurious than others. We detail all cars’ strengths and weaknesses in our road tests to help you identify which type of luxury car will work best for you. Below we highlight important features for you to consider when purchasing a sedan.

Engines and Fuel Economy
Most luxury cars aren’t about saving fuel. But if you want to have your cake and eat it, too, some luxury cars and SUVs are available with hybrid or diesel powertrains.

The highly rated Tesla Model S happens to be both a luxury sedan and an all-electric model that returns 87 MPGe (miles-per-gallon equivalent). Among luxury hybrids, the midsized Lexus ES 300h got 36 mpg overall and the Lincoln MKZ hybrid netted 34 mpg.

At the other end of the spectrum, the thirstiest luxury SUV we’ve tested, the Toyota Land Cruiser, got 14 mpg. The Lexus RX 450h hybrid got 29 mpg overall in our tests, the same as the small Lexus NX 300h hybrid.

Many luxury cars require premium gasoline, so shop carefully if that extra cost is a concern. (Hint: Open the fuel filler door and look for a label that says premium fuel is recommended or required.) Diesel vehicles offer significant fuel-economy advantages, but diesel fuel is more expensive than gasoline in many areas of the country. Diesel vehicles won’t run on gasoline; putting gasoline in a diesel car’s tank will cause extensive (and expensive) damage.

Technologies such as cylinder deactivation, where the engine shuts off some of its cylinders under low power demands, can squeeze out slightly better mileage in highway driving. An increasingly common feature is engine shutoff when the vehicle is stopped, such as at a traffic light. The engine will shut off, rather than idle, to save fuel. It will restart as soon as the driver lifts off the brake pedal.

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 generally limited to smaller and sportier models.

Some hybrids use a continuously variable transmission (CVTs) to maximize fuel economy and performance. Certain sporty models offer a dual-clutch transmission, which promises the fuel economy and performance advantages of a manual with the convenience of an automatic. These transmissions provide lightning-quick shifts in either manual or automatic mode, which makes them a good choice for performance-oriented models, but some of them lack smoothness at very low speeds, particularly when parking.

Whatever improvements are made to the engine, gearing, tires, and aerodynamics, the bottom line is what happens on the road. That’s where performance measures such as our on-road fuel-economy figures can help. (Check our fuel-economy ratings.)

Drive Wheels
While most mainstream cars use front-wheel drive, luxury cars are typically available with rear- or all-wheel drive, though brands such as Acura, Audi, Lexus, and Lincoln offer front-wheel-drive models.

Front-wheel drive typically provides better traction than rear-wheel drive in slippery conditions. Conversely, rear-wheel drive usually enables better handling and steering on dry roads. All-wheel drive offers significantly better traction during inclement weather and better dry-pavement handling and cornering than front-wheel drive. But AWD does not shorten stopping distances, it adds cost and weight, and it often comes with a small fuel-economy penalty.

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

Ducking, bending, and squatting aren’t luxury experiences. Most luxury sedans and SUVs are designed to provide easy ingress and egress, often employing an exit mode that automatically powers the driver’s seat back and retracts the steering wheel. Some models will even cinch the doors closed, requiring only the barest of human effort.

Rear-seat access is more variable. Being lower, sleeker, and with thicker seat bolsters, sporty cars are almost always more difficult to enter. Try entering and exiting through all doors, front and rear, when comparing cars. A well-designed sedan should provide wide doors and enough headroom so that front and rear passengers can access the cabin without bumping their heads. Some sedans are styled with low, sloping rear rooflines. Such coupelike designs can degrade rear-seat accessibility, headroom, and the driver’s view aft.

A common feature among luxury cars (and, increasingly, among mainstream cars) is the proximity key. The key is actually a small transmitter that can stay in your pocket or purse. As long as the key is with you, the doors can be locked and unlocked by pressing a button on the door handle (or sometimes by simply touching the handle itself). Some cars will illuminate puddle lamps under the side mirrors when a person with the key approaches. Most cars with this feature also have keyless push-button ignition. This feature makes it almost impossible to lock your keys in the car because the doors won’t lock if the key is detected inside. But once the engine is started, it is possible to drive off without the key.

If you expect to carry long or bulky cargo, look for a fold-down rear seat with a tall, wide opening to the trunk behind. Even a small pass-through port can be handy for long, slender items such as skis. Batteries in hybrid models can restrict trunk space, and both hybrids and high-end models with reclining rear seats may not have a fold-down seatback or a pass-through. Unlike in mainstream sedans, fold-down seatbacks are sometimes an option on small and midsized luxury cars, and they’re not available at all on the largest ones.

If you plan to carry a lot of passengers in your luxury SUV, make sure to check out how much cargo room is left in back with all the seats raised. Most seven-passenger SUVs leave little space behind the upright third row—think grocery bags, not luggage. Only the largest SUVs offer decent cargo space with all seats occupied.

Advanced Safety Features
The newest and most advanced safety features tend to be offered in luxury cars first. Expect a high-level of safety systems to be available, though on several luxury cars (notably those of German pedigree) such features can be optional. 

Forward-collision warning and automatic emergency braking are two valued systems that are fast becoming standard equipment on many new vehicles. Forward-collision warning (FCW) technology provides a visual, audible, and/or tactile alert to warn the driver of an impending collision with a car or object directly in its path. If a car equipped with automatic emergency braking (AEB) senses a potential collision and you don’t react in time, it starts braking for you. IIHS data show rear-end collisions are cut by 50 percent on vehicles with AEB and FCW.

Other modern safety advances include telematics systems that alert emergency personnel if an airbag deploys, lane-departure warning systems that sound an alert if you change lanes without signaling, lane-keeping assist to center the vehicle in the lane if you start to drift, and blind-spot warning systems that indicate vehicles driving in the blind spots to the side and rear of you.

Entertainment and Convenience
The latest mobile electronics enable cars to deliver the fidelity of home theater, along with Bluetooth smartphone connectivity, Android Auto and Apple CarPlay compatibility, and navigation guidance. Factory-supplied systems usually offer voice-activated controls for audio, phone, and navigation with various levels of sophistication.

Stereos are a selling point on many luxury cars, and most models come standard with systems that would be considered premium-level in mainstream cars. Some vehicles offer high-end branded stereos from suppliers such as Bang & Olufsen, Bose, Burmester, Harman Kardon, and Mark Levinson. These systems can cost thousands of dollars, with differences in sound quality that only a true audiophile can appreciate.

Luxury vehicles usually offer rear-seat entertainment systems that can play DVD or Blu-ray movies and have inputs for gaming systems and wireless headsets. There is a wide range of information and entertainment features available from the factory, additional ones that the dealer can install, and even more available through the aftermarket.

Audio System
Most luxury cars come standard with powerful audio systems that allow you to play music loud with minimal distortion and more and better-quality speakers to enhance clarity and sound separation. They include USB and Bluetooth audio inputs, MP3 playback capability, satellite radio, and HD radio. Optional systems add digital sound fields, noise canceling, surround sound, and DVD-Audio playback. Depending on the package, an audio upgrade can add many hundreds or even thousands of dollars to a luxury car’s sticker price.

Cars at every price level typically include a USB jack and a plug for an MP3 device to play back through the car’s audio system. 

Satellite and HD Radio
Subscription-based satellite radio (SiriusXM) offers a broad selection of channels with catering to a variety of musical and information interests, with uninterrupted service from coast to coast. Subscription packages range from $11 to $20 per month, and you can add service for your smartphone, computer, and home satellite radio for an additional fee.

HD Radio allows conventional (aka terrestrial) AM and FM stations to broadcast their content over digital signals with higher fidelity. It also allows stations to add more programming over several additional subchannels that can be broadcast alongside a station’s main frequency. This function can be used for delivering traffic updates, weather information, or more diverse music content.

Navigation Systems and Connectivity
In-car navigation is a handy feature if you often drive in unfamiliar territory, and although it would seem to be an obvious feature to include in a luxury vehicle, many high-end cars offer it only as an extra-cost option—often at a price higher than mainstream cars, and sometimes bundled with other expensive equipment. Built-in systems have large, clear screens mounted in the center of the dashboard and have generally intuitive controls. They are integrated nicely into the car, and many systems use touch-screen displays, which make it easy to enter destinations and scroll through menus.

Most respond to voice commands, giving you the added safety of keeping your eyes on the road and hands on the wheel. For a subscription fee, most systems can provide real-time traffic reports, which can alert you to congested traffic, accidents, or road construction. But small, portable GPS units can offer most of the same capabilities for far less money. And, of course, you can also put your smartphone in a dash or windshield mount and use Google Maps or a navigation app, such as Waze. (See our Ratings to learn more about portable GPS navigation systems.) 

Bluetooth connectivity is now ubiquitous, enabling devices such as smartphones to wirelessly communicate with the car’s audio system. This allows convenient hands-free phone operation, as well as playback of music stored on the phone. Many infotainment systems can stream Internet-sourced audio to the car using apps such as Aha and Pandora.

Telematics systems, popularized by GM’s OnStar, use a combination of cellular telephone and GPS technology to connect drivers with a call center staffed 24 hours a day, 7 days a week, at the touch of a button. For a monthly or annual fee, such concierge services can provide directions and other travel aids. They also have an SOS feature that automatically calls to check on the car after an accident. If need be, these systems can summon emergency services, using the car’s built-in GPS receiver to give first responders your car’s location.

New vs. Used

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 price similar to a brand-new mainstream car’s. The first thing you need to weigh is the value of having more prestige for less money vs. 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 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. Plus, 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.

Consumer Reports’ 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 prepurchase 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 that you can choose a good model and to follow that up with effective negotiation.

Learn more in our New & Used Car Buying Guide

When you shop through retailer links on our site, we may earn affiliate commissions. 100% of the fees we collect are used to support our nonprofit mission. Learn more.