During the late 1980′s, many of the “luxury brand” vehicles, such as Lexus, Acura and BMW became more affordable. Instead of targeting only the truly wealthy, these brands started targeting those who were still middle class income-earners, but had the desire to be wealthy someday. They made more affordable versions of their vehicles, which were still more expensive than your typical Toyota, but started a much lower base price so that they were accessible to the middle-class.
With the recent economic recession, many of those individuals who had medium-high incomes that would buy these entry level vehicles have a lot less money than they used to. Many sales-professionals are getting pinched by the down-turn as their commissions fall through the floor. Other professions are facing unemployment, salary reductions and rapidly declining investment portfolios. Since many of these people now have lower incomes, they are much less likely to buy an entry-level luxury automobile. Rather, they’re more likely to move to a more affordable brand or keep the vehicle that they do have for a longer period of time.
This has created an opportunity to grab a big, big bargain on both new and used luxury vehicles. Some professions have had to sell their current luxury vehicle at “fire sale” prices because they can no longer afford the vehicle that they have. Entry-level luxury automobile dealers are also feeling the pinch, because sales are down quite dramatically.
If you’ve lived a cash lifestyle and haven’t incurred a lot of debt and are looking for a new vehicle, there’s the possibility that you could get an entry-level luxury vehicle at quite the bargain right now. BMW is currently offering 0.9% APR financing on their new vehicles. Almost all of the other luxury dealers are offering similar discount financing and affordable lease options.
Perhaps the real savings is getting a gently-used entry-level luxury vehicle. Typically expensive vehicles lose more of their value in the first few years of ownership than a Toyota, Ford, Honda, Hyundai, Dodge, Chevy, etc. because most individuals that would buy a luxury vehicle would prefer to buy a new vehicle, so there’s less of a used market out there. A new car will typically lose 60% of its value in the first four years of ownership, so if you’re not terribly concerned with the “cool guy” factor in owning a new vehicle, you can let someone else eat that loss and get a steal on your next vehicle purchase.
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