The Best Luxury Cars Under $40,000

Updated on January 19, 2019
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Steven Symes was turning a wrench long before he could legally drive, and is a self-described car nerd. He also loves to go off-roading!

You can get an Infiniti Q60 under $40,000, but just the bottom trim
You can get an Infiniti Q60 under $40,000, but just the bottom trim | Source

Many times, when people think of luxury cars, they imagine ultra-opulent rides with price tags pushing well north of $100,000. Not everyone has that kind of budget, but that doesn't mean you can't enjoy something luxurious.

In fact, if you're on the hunt for an affordable luxury car, there are good options abound. You'll still enjoy plenty of top-shelf amenities, superior craftsmanship, and a level of prestige not possible with mainstream models. This isn't by any means a list of the best luxury cars available, but rather some great choices for the best luxury cars under 40K.

Lexus IS

You don't need to worry about costly repairs and maintenance with the Lexus IS
You don't need to worry about costly repairs and maintenance with the Lexus IS | Source

The Lexus RC coupe has a starting MSRP just barely above the $40,000 mark. However, the Lexus IS sedan barely sneaks under it. Overall, it's a great car for everyday use with a good amount of luxury for the price.

First, the good. When you get a Lexus, you don't need to worry about constantly paying for costly maintenance and repairs. The IS runs and runs well, so you can spend your cash on other things. If you like the aggressive exterior appearance, including the angry front fascia, then it's all good. On the inside, you get quite a few features for the price, even on the base model.

The IS also drives smooth. Head down a road with plenty of bumps, and you won't suffer. Press the engine hard, and the transmission gracefully switches gears. Even the cabin insulation ensures you can enjoy quiet music at freeway speeds.

BMW 2 Series

The BMW 2 Series gets a 2.0-liter turbocharged four-cylinder engine.
The BMW 2 Series gets a 2.0-liter turbocharged four-cylinder engine. | Source

Yes, you can get a Bimmer for relatively cheap. Up front, you'll have to stick with either the 230i Coupe or 230i XDrive Coupe to keep MSRP below $40K. But anyone who wants to impress the neighbors with this famous Bavarian brand can do so without breaking the bank.

Since the 2 Series is smaller than the 3 Series and 4 Series, expect a cramped backseat. You'll also have a short list of standard features on the two models that slide in at under $40,000, so don't expect tons of creature comforts.

That being said, BMW still applies quality craftsmanship to the cabin and the body, so you won't notice garish gaps between components or suffer through sketchy switchgear. Overall, the design aesthetic of the 2 Series is more pure than other modern Bimmers, and so is the driving experience, which is why this model has been lauded by enthusiasts.

The 230i twins use the same 2.0-liter turbocharged four-cylinder engine. If you haven't experienced it for yourself, be prepared for some sporty acceleration, but it won't be a muscle car experience. Still, the engine makes driving the well-balanced chassis fun enough to make this option well worth considering. Sadly, if you select xDrive, BMW's all-wheel-drive system, the wonderful 6-speed manual transmission isn't an option. At least the 8-speed automatic comes with paddle shifters.

Cadillac ATS

The Luxury trim on the Cadillac ATS comes in right under the $40K mark
The Luxury trim on the Cadillac ATS comes in right under the $40K mark | Source

You might not be a fan of the highly angular looks Cadillac has been pushing for some time, but the new ATS heads in a different direction. Its appearance has been smoothed out, like a fine suit, so you'll turn heads for the right reasons.

When you climb inside, immediately you'll notice all the materials feel like they're of top-shelf quality. Forget flimsy plastic bits here and there – this car can really compete with German luxury brands when it comes to cabin composure. You also get a well-designed controls layout. If you upgrade to the Luxury trim, which has an MSRP just below the $40K mark, you gain amenities like a heated steering wheel and front seats, remote start, auto-dimming mirrors, and Brembo front brakes.

Cadillac ATS-V Video Review

Where things get interesting is the backseat. Legroom and headroom are okay, but try hauling around taller passengers and you'll hit the limitations quickly. The same is true of the trunk space, so this is not your weekend grocery getter.

At your command is a 2.0-liter four-cylinder force-fed by a twin-scroll turbocharger, which produces 20 pounds of boost. As a result, you have on tap 272 horsepower and 295 lb-ft of torque. That's tied to either a 6-speed manual or 8-speed automatic transmission. Balancing all that out is a suspension that allows for little body roll, plus a surprisingly balanced layout. You'll have plenty of fun driving the ATS on a curvy road.

Acura TLX

You can decide between a four-cylinder and V6 with the Acura TLX
You can decide between a four-cylinder and V6 with the Acura TLX | Source

The Acura TLX is another great luxury car under 40K. If you watch your options, you can get this sedan with the 3.5-liter V6 engine, which whips out 290 horsepower, and stay under budget.

Again, if you're careful about options, you can even add Super Handling All-Wheel Drive (SHAWD) to the mix. While that combination doesn't make this a performance sedan by any stretch of the imagination, it does inject a little bit of fun into everyday driving.

However, if you're fine with the four-cylinder engine, you can get some cool optional tech instead and stay within the budget. Among the available goodies is turn-by-turn navigation, rain-sensing wipers, HD radio, GPS-linked climate control and rear cross-traffic monitoring.

If you want a luxury car for the impeccable interior, you might be disappointed by the TLX. Like other Acuras, the materials as well as fit and finish don't quite rise to the level you'll find in competing luxury cars.

At the same time, the sedan takes up the same amount of space as a compact, but delivers interior space more like a midsize sedan. That means most people won't be squished in the back. Loading large items into the trunk isn't a squeeze, either.

Audi A3

The Audi A3 gets a turbocharged 2.0-liter four-cylinder engine with 186 horsepower.
The Audi A3 gets a turbocharged 2.0-liter four-cylinder engine with 186 horsepower. | Source

Audi has a reputation for making vehicles that handle especially well, if you're into that sort of a thing. Even the Q7 corners like a dream, and as you can probably guess, the little Audi A3 does as well. While not all versions of the sedan come with Quattro all-wheel drive, you can get it on all but the top trim, and still keep MSRP under $40,000.

The Audi A3 gets a turbocharged 2.0-liter four-cylinder engine, which pumps out 186 horsepower. It's definitely not drag strip-worthy, but you can have fun carving up canyon roads. However, when you're trying to get up to freeway speeds you'll quickly find the A3's limits.

Interior appointments are of good quality, and overall craftsmanship is excellent, just like you'd expect from Audi. You also benefit from a smooth and easy-to-use infotainment system. Mobile WiFi built into the car is another big bonus. Unfortunately, if you need to actually transport humans in the backseat, prepare for issues with space. The car is also vulnerable to horrible road noise that floods into the cabin at freeway speeds.

Despite those shortcomings, the Audi A3 still makes for enough fun to justify buying, if you're so inclined.

Mercedes-Benz GLA

With a $40,000 budget, you can choose either two-wheel drive or 4Matic.
With a $40,000 budget, you can choose either two-wheel drive or 4Matic. | Source

As one of the few SUVs on this list, the Mercedes-Benz GLA will serve a specific market segment. If you don't want to put much effort into driving, plus want a decent amount of cargo space, this will provide.

With a $40,000 budget, you can choose either two-wheel drive or 4Matic. Both versions of the SUV use the same turbocharged 2.0-liter four-cylinder engine. It puts 208 horsepower and 258 lb-ft of torque at your command. That doesn't sound like much, but thanks to good tuning and gear ratios, the GLA feels sporty enough to make things interesting.

Absolutely, you can let the GLA live a completely urban or suburban life. But it will handle trails with glee, meaning you can get out into nature on the weekends and go where other cars fear to tread. Just remember this isn't a Jeep, so don't get too bold and you'll be okay.

Mercedes-Benz GLA Video Review

As a Mercedes, this SUV also features amazing safety technologies. Add LED headlights to complement the LED taillights and running lights to provide crisp and even forward illumination on dark roads. Radar sensors warn if you're about to hit an object in the front and rear, plus they detect if you're driving drowsy. Those are just a sampling of what you get.

Thanks to the swooping profile, the GLA's backseat doesn't provide a ton of space. Taller passengers will especially feel the pinch when it comes to headroom. That tapered look also means cargo space is minimal, which is a little ironic sine the GLA's supposed to be a "utility vehicle."

You do get amazing interior quality. Top-shelf materials combine with impeccable layout and design for a presentation that's second to none. Even at freeway speeds, superior insulation keeps the cabin quiet enough to hear the passengers or listen to music without problems.

Just watch the options when buying the GLA – they'll inflate the price quickly, busting your budget and forcing you into a tough decision.

Infiniti Q60

If you want to stay under $40K, you'll have to go with the bottom Infiniti Q60 trim
If you want to stay under $40K, you'll have to go with the bottom Infiniti Q60 trim | Source

If you're in the mood for something that's sportier and less about practicality, the Q60 isn't a bad direction to explore. Of course, you can only consider the bottom trim for an MSRP that barely sneaks under the $40,000 limit. Still, you get a lot of car for that price.

The 2.0-liter turbocharged four-banger in the Q60 2.0t Pure model whips out 208 horsepower. That's a far cry from some versions of the coupe. But it still provides some entertainingly quick acceleration, without guzzling gas. Handling is good, although not quite great. You might find the brakes are a little on the weak side, so proceed with caution when driving hard.

Infiniti has really stepped up its game when it comes to interior materials. Gone are any signs of cheap plastics and other questionable items. A high level of craftsmanship permeates as well. The driver and front passenger get plenty of space to stretch out, but the backseat is cramped. Most physical controls are simple to use, but the weird dual-screen infotainment system layout can be just plain confusing. You can look past all these shortcomings though, if you enjoy the positive attributes enough.

Vote For Your Favorite On This List!

Which Do You Think Is The Best Luxury Car Under $40,000?

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This article is accurate and true to the best of the author’s knowledge. Content is for informational or entertainment purposes only and does not substitute for personal counsel or professional advice in business, financial, legal, or technical matters.

Questions & Answers


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      • profile image


        2 years ago

        I just wish more of these newer cars offered manual transmissions

      • c1rca profile image


        2 years ago from USA

        I like Lexus, they tend to be more reliable.

      • fastornothing profile image

        Rick Santoli 

        2 years ago from USA

        These are some really nice cars for under 40,000$ I bet with options it will be hard to keep the price that low. Maybe look for a CPO and save some $$$

        I'll take any of these still available with a manual transmission!

        Cool article btw.


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