My partner is a car enthusiast who changes cars every two or three years. He’s currently leasing his Mazda CX-30 until November 2023, but I told him to finance it next time as leasing is costly. Here are some of his important criteria to consider:
- Compact or subcompact SUV
- Monthly payment of around $400 with five-year financing
- Good power/peppy performance
- Plug-in hybrid
- Less road noise
Are there any upcoming models he should wait for if we can’t find any now? – Bryan
Mark Richardson: Maybe Bryan should leave his partner’s car-buying decision to his partner. Five-year financing of $400 a month for a plug-in-hybrid is not going to happen.
Petrina Gentile: I’m afraid you’re right. You just drove the new Mitsubishi Outlander PHEV, which is a lower-priced plug-in hybrid. How much would that be?
Richardson: Well, it lists for $46,538, if the dealer will let you pay cash. Some don’t, because they want to make money from the financing and they can do it because demand is way above supply. So the finance interest rate from Mitsubishi for an Outlander PHEV is 6.49 per cent APR, which means you’re actually paying $55,555 and the monthly payments over five years are $1,087. That’s for the most basic trim level.
Gentile: Wow – that’s a lot! Unfortunately, Bryan, $400 a month for a PHEV is wishful thinking with the current market, supply issues and rising interest rates.
Richardson: You know what does cost about $400 a month, over five years? A basic Mazda CX-30. But that’s leasing, which means he owns nothing at the end of the term. If he finances it over five years, it’ll cost $559 a month at 5.5 per cent. Maybe Bryan should not be trying to advise his partner on buying a new car.
Gentile: So how would you advise Bryan’s partner?
Richardson: Well, let’s assume he’s leasing the CX-30 over three years. At today’s rates, he’d pay about $450 a month for the least expensive edition, with an interest rate of 4.7 per cent. So I’m guessing his current payments are probably $400 a month with the lower interest rates of two years ago. If he likes to trade-in every three years, then he’ll get more car for his money with leasing, and it will be relatively worry-free – he just won’t have a capital investment.
Gentile: And that’s a big downside, for some. Nothing to show for all of those expensive monthly payments at the end of the lease.
Richardson: You do get a better car though, because you’re really only paying for half of it. And it sounds like Bryan’s partner wants a better car, and a new car, too, because the CX-30 is such a new model.
Gentile: Maybe he has a much higher budget and Bryan wants him to cut back. He’s asking what might be coming, too.
Richardson: Nothing that’s coming in the next couple of years is going to be any more affordable, is it? Frankly, he’ll be better off buying or financing a gently used car, even in this costly market for used vehicles. But because it was Bryan who wrote to us, let’s stick with new ones. How about the new Honda HR-V? I doubt anyone who loves cars will like it, but have you driven it yet?
Gentile: Go easy on the guy. I haven’t driven the 2023 HR-V, yet. It has been completely redesigned for 2023 with a new look and more features. But I honestly don’t think he would go that route.
Richardson: We have an impossible task here. A true enthusiast with a budget that affords a new CX-30 would invest in an interesting used car – something like a Volkswagen GTI or a Dodge Challenger or a Jeep Wrangler – but Bryan’s partner seems to want a new vehicle. Frankly, I think we should let Bryan’s partner write to us and tell us what he really wants, because what Bryan wants for him doesn’t exist.
Gentile: Agreed. And if he doesn’t want to, the Mazda CX-30 is my pick for Bryan’s partner.
Richardson: Then he might as well keep the one he’s got. If he wants a change, maybe a Ford Ecosport or a Hyundai Kona, which are the right price and enjoyable to drive, but not interesting.
Gentile: Ecosport and Kona aren’t that enjoyable to drive – at least, I don’t think an enthusiast would enjoy them. The CX-30 is better. But it’s still hard to say because we haven’t heard from Bryan’s partner.
Richardson: Bryan, can you ask your partner to write to us and tell us what he wants? He might be more realistic on what he’d like within his budget: new or used, sporty or practical.
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