Why Buy a Cheap Car?
New cars are more expensive than ever. The average sale is well over $30,000, and the average monthly payment is about $450. Yet we see ads for new vehicles priced at half that — so why not buy one of the cheap cars?
By Aaron Gold
A CHEAP CAR IN PRICE, NOT IN CONTENT
There was a time when almost every manufacturer had a “loss leader” — a stripped-down model with a super low price. These cars were devoid of creature comforts; their primary purpose was to draw buyers into the showroom, where they could be up-sold to a more plush (and more profitable) version of the same car.
Today’s cheap cars aren’t quite so dire. Most come with air conditioning and a stereo, and some even have power windows and locks. (Believe it or not, it actually costs less to build a given model of car with these features than it is to build some with and some without.) However, their purpose has not changed; they’re still designed to bring buyers in rather than to sell. In order to make sure they aren’t too desirable, automakers often limit color choices, leave off nice-to-haves like cruise control, or limit the number of extra-cost options. And dealers, in turn, may add overpriced features like fancy wheels or alarm systems to drive up the profit.
FOCUS ON WHAT YOU NEED
If you’re considering a cheap car, it’s important to remember what your are buying: A machine to get you from point A to point B. We have become used to cars that offer all the comforts of home, but all we really need are wheels, a seat, and an engine. If you can drive a stick-shift, that will help immensely; some manufacturers only offer automatics with a “preferred equipment package,” and others only offer the cheapest models with a manual transmission. That said, don’t discount the value of some extra-cost options: If you have kids, for example, a car without power locks can make getting the family in and out a real hassle.
RESEARCH IS THE KEY TO A BARGAIN
If you’ve decided that cheap wheels are for you, you’ll need to do some research. Start with our article on the ten least-expensive cars. Call ahead to the dealer and ask if they have not just the model you want, but the trim level — the letters or numbers after the name. If you’re after a $12,780 Nissan Versa S but the dealer only has the $14,580 Versa S Plus in stock, there’s no need to make a wasted trip. Try to find a car that has no aftermarket accessories — an overpriced alarm system or pinstripes can torpedo the value of a cheap car. Lastly, remember that the purpose of the car is to draw buyers into the showroom. When your sales rep attempts to steer you to a more expensive version, remember that she’s just doing her job. And when she tells you you can get a nicer car for a few more dollars a month — or the same payment for a longer term — be sure to add those numbers up in your head so you realize how much you’re really paying. Be firm and bargain hard — don’t lose sight of the fact that most buyers don’t want these inexpensive cars, so you should be able to negotiate a decent discount.
REASONS TO BUY A CHEAP CAR
New-car reliability, latest technology and safety features, huge savings over pricer models!
REASONS NOT TO BUY A CHEAP CAR
Lack of nice-to-haves (cruise control, power locks, automatic transmission), lower resale values, less fun, no new car smell :))