5 best luxury cars under $40,000

By Jason NolteJanuary 7, 2014 5:55 PM

Audi A5

In the darkest days of the recession, flaunting one’s income or wealth through conspicuous spending was considered ill-advised, if not outright dangerous.

At the very least, it was unsympathetic.

Even as the economy creaks toward recovery, outward displays of wealth just about anywhere outside of Silicon Valley are still greeted with a measure of scorn. In the Valley and San Francisco themselves, there are entire sites devoted to shaming that sort of behavior.

That hasn’t stopped the haves from treating themselves in somewhat less obvious ways. Why back up a Tesla to the nearest supermarket charging station or pull your Mercedes-Benz E-Class into some grimy parking lot when you can go somewhat incognito? That’s what “entry level” cars are there for. Presumably offered to give aspiring spendthrifts a leg up into the world of luxury vehicles, entry-class cars are also a nice little means of fading into the background.

Every luxury marque has the “cheap” version: The one anyone willing to be locked into a super-sized lease can pick up and drive off the lot at will. The one that appears in slightly less tony locales and is equally at home in both the Safeway and Whole Foods’ parking lots.

For some, it’s an aspirational purchase. For others, it’s the “everyday” car that’s a step above what the help uses to drive around the grounds but not quite as nice as the garage-kept vehicles reserved for top-down cruising or quiet evenings out.

In either case, they’re selling. Luxury car sales rose by roughly 13% in 2013, according to MotorIntelligence. Among those automakers seeing the biggest bumps are Mercedes-Benz (14%), Audi (13%) and BMW (11%). All have dabbled in vehicles with starting prices flirting with $30,000, and just about all have been rewarded for it. With help from the folks at Kelly Blue Book we found not only a handful of great luxury cars for less than $40,000, but the best vehicles you can buy for that price.

5. 2014 Infiniti Q50
MSRP: $37,050

Though meant to replace the venerable G37, the Q50 isn’t just some overhauled version of an old Nissan luxury sedan.

A 3.7-liter, 328-horsepower engine produces a ton of kick, but still eats up only 30 miles per gallon on the highway. Adaptive steering and all-wheel drive give the person behind the wheel a bit more control, while a lane departure feature helps drifting drivers stay on the straight and narrow. In fact, backup and blind-spot safety features will also hit the brakes or stop a lane change if it feels a crash is imminent.

While that’s all lovely and terribly practical, a lot of the more luxurious elements are reserved for the car’s tech offerings. Infiniti inTouch stocks a dual-touchscreen entertainment and information console with apps including Facebook and Pandora while its Infiniti Connection service keeps tabs on your car’s location through your mobile device and can even make dinner reservations through its Personal Assistant service. While drivers can also lock and unlock their vehicle’s doors through a smartphone, safety features including Automatic Collision Notification, Stolen Vehicle Notification, Enhanced Roadside Assistance and Alarm Notification all come in handy as well.

Again, all this comes in an entry-level vehicle.

4. 2014 Lexus IS
MSRP: $35,950

There’s a lot of wiggle room in this model for folks who want to keep it below or around $40,000.

That starting MSRP is for the base IS 250, which comes with with rear-wheel drive, heated mirrors, dual-zone climate control, power moonroof and base tech perks. For $38,000, they’ll throw in all-wheel drive and heated front seats. For $39,000, the rear-wheel-drive sports package kicks in a digital instrument panel, bolstered and heated front seats, a leather shifting knob and aluminum pedals.

For $39,500, the IS 350 takes the 250’s 204 horsepower and 30 miles per gallon on the highway and boosts it to 300 horsepower and a slightly pokier 28 MPG. What about the Enform entertainment, navigation and emergency assistance system? Well, let’s just say Toyota is a little more tight-fisted with perks than its luxury competitors.

3. 2014 Audi A5
MSRP: $39,000

Audi and its parent company Volkswagen really know how to load up a car, and the base A5 is no exception.

For the entry price, drivers get a 220-horsepower engine, 32 miles per gallon on the highway and all-wheel drive. Inside, there’s three-zone climate control, a panoramic sunroof, leather seats, a 10-speaker Bang & Olufsen audio system, Bluetooth wireless capability and an MP3 hard drive with voice command.

Granted, this price range denies buyers some of the A5’s cooler features, such as Drive Select, which lets drivers adjust engine noise, set adaptive cruise control that adjusts speed by locating cars through radar and activate blind-spot warning lights when cars are in adjacent lanes. They also miss out on a tech package featuring a rearview camera and navigation system built around Google Earth. Still, you’re getting the same engine, performance and basics as those shelling out more, so enjoy.

2. 2014 BMW 3 Series
MSRP: $39,000

To be more specific, you’re getting a member of the 328 family for this price, but that’s not exactly upsetting news. The BMW 3 Series isn’t so much the “cheap BMW” as it is the sought-after Beemer that just happens to come in at that price.

Packed with great features including a heads-up display projected onto the windshield, blind-spot detectors in the rearview mirrors and a freestanding iDrive screen for communication, navigation, entertainment and apps, the 3 series doesn’t exactly come up short on perks. In fact, it piles them on with features including a pushbutton starter that shuts the engine off when idling, a 240-horsepower engine that gets 34 miles per gallon on the highway, adaptive all-wheel drive and hands-free trunk access.

Know what else squeaks into the 328 series? A turbodiesel model that gets a mild-mannered 180 horsepower, but boosts fuel efficiency to 45 miles per gallon on the highway. Those are a lot of options at a price that’s supposed to offer luxury car buyers very little.

1. 2014 Cadillac ATS
MSRP: $33,000

When Mercedes offered its CLA coupe in the U.S. for just under $30,000, it became a race to see which high-rolling automakers could go lowest with their prices.

Cadillac was at the front of the pack, mostly because it had to be. Its CTS, while popular and less expensive than many of the cars on this list, was a lot bigger, heavier and less efficient. Though General Motors felt it was giving drivers more for their money, it turns out luxury buyers pay for very specific size, performance and options.

Though the base model offers a 2.5-liter, 321-horsepower V6, the ATS also comes with a 2.0-liter turbo engine that puts up an impressive 272-horsepower while keeping the starting price at roughly $35,000. That bumps up to $37,000 when you opt for all-wheel drive, but even those base models come with a Bose seven-speaker sound system, OnStar communications and assistance, dual-zone climate control and leather steering wheel. While it still lacks a bunch of the basic luxuries its competitors consider standard, there’s enough leeway with that base price to add a few options packages without breaking the bank.