Luxury Vs. Affordability: What’s The Better Car Purchase?

Luxury and affordability are two completely different parts of the same thing. But they cater to different market segments. One is for the middle and lower-middle class, and the second is for the elite and upper elite class.

The choice depends on what market segment a person belongs to and how much cash he has to buy a car. For an ordinary person living in the US, the affordable car would be something that is below $35K. That is the definition of a car according to research by International Economic Review.

Moreover, affordable cars are classified as cars that fall in A, B, and C categories. On the other hand, luxury cars are all cars in category D or above.

So, a clear definition of both vehicles is:

Luxury vehicles: $35,000 or more

Affordable vehicles: $35,000 or less

Who buys an Affordable car?

Now let’s see who buys an affordable car. To find it, we need to know the per capita income of the US. It is $66K in 2019. $66K looks like a lot, isn’t it? But when you observe the savings potential of each year, you will get the whole picture.

According to CNBC, the average savings in the US are around $11K. This leaves them with less than $35K even after 3 years of savings. So, an average American prefers to buy a car that is under this mark.

Since most of the cars lose their 20% value in the first year, most Americans prefer to buy a used car.

Who Buys a Luxury Car?

Now let’s look at the Luxury car buyers’ characteristics:

  • People who earn more than $100K annually in the US
  • Those who are interested in possessing a luxury car. This market segment is pretty small in the US and consists of 7% of the total market share.
  • As per quora, most luxury car owners have said that the total cost of owning a luxury car is around 1% to 5% per month of the total car cost. This means if your car costs around $40K, your car’s monthly maintenance will be around $1600 per month.
  • Two things describe the taste of a person who wants luxury cars, exclusivity, and status symbol.
  • Most luxury car buyers prefer to buy only those cars that offer comfort, safety, and durability.

Which One to Buy? Luxury or Affordable Cars

We created a table to help you understand the difference between a regular car and a luxury car. Since luxury cars have a higher price point, they offer more comfort and come with numerous features. On the other hand, an affordable car is no match for a luxury car in terms of features, but it is what its category says: affordable.


A luxury car will pack a lot of features that affordable cars won’t have. These features include traffic sensors, zone control, climate control, heated seats, ambient lights, moon roof, an internal navigation system, and more.

However, to get these things in an affordable car, you will have to shell out more money.


Performance-wise most luxury cars are a lot faster than affordable cars. Most of them have V6 or a V8 engine that makes them exceptionally fast. These cars can do 0 to 100 mph in less than 10 seconds. Also, these cars have a 200+ horsepower that makes them a power tube in comparison to regular cars.

Moreover, luxury cars, despite being bulky, can handle tight turns smoothly. Some of them even offer all-wheel drives that allow them to cruise the roads freely. But all this is available at a cost, and luxury cars have low mileage in comparison to affordable cars.


Luxury cars – Class D cars – mostly cost $40K or more. These cars are not made for everyone, they have a specific segment that they target. Take Tesla, for example, most of its cars are geared toward the elite class. These cars are priced between $35K and $80K. Almost all these cars are class D categorized because of the features available in them.

On the other hand, affordable cars include every car that is in the Class C category or less. These cars include Sedan, Hatchback, Crossover, and more. However, these cars are available between $15K and $35K. For example, the Honda Civic costs $20K. There are many trucks available in this price segment, as well as the Nissan Frontier that is available for $20K as well.


We have already discussed the monthly maintenance of luxury cars. It is around 4% of the total price of the car. This rule also fits affordable cars. However, since most of them are around $20K in price, the total monthly maintenance cost is also ~$1K or less per year.

According to Finder, average car maintenance cost in the US is around $1200 per year. It includes everything from an oil change, car tuning, car wash, tire replacement, brake replacement, and handling to the usual wear & tear of parts.

The maintenance of the car also depends on the type of engine it has. Electric cars have low regular maintenance because the cars have no engine in them. On the other hand, hybrid cars will cost more to maintain.

Cars having internal combustion engines (ICE) will cost even more than the two because they only have a combustion engine. Combustion engines require more service to maintain.

Which One Is Best? Luxury Car or Affordable Car?

The answer depends on your needs. If you are low on budget and would like a decent car for commute, then an affordable car will do the trick. However, if you have lots of cash in your hands, and you want to buy a car that offers the most comfort, then a luxury car will be best for you.

As we said earlier, there is no comparison between the two as both caters to different segments of the market. So, what do you think?

Hope this article is a great source for you to make the right choice. Do you have any suggestions too? Please share them with us in the comments section below