Should You Avoid Buying a Base Model Car?
When you’re shopping for a new car, SUV or pickup truck it’s easy to get tempted by the low prices advertised for base models. The price might be right for your budget, but should you go ahead or should you avoid buying a base model car and consider an alternative?
If you’re leasing a new car and looking for the lowest monthly rental then buying a base model can be a good idea. If you’re not leasing and therefore you’ll eventually have to resell or trade your car then buying a base model is something you should probably avoid.
Entry-level used vehicles are not particularly desirable with buyers and residual values are therefore not as strong as they are for higher-specification versions of the same vehicle. If you want to retain as high a percentage of your car’s initial purchase price as possible a higher-spec model is the way to go.
The truth about base model cars
Automakers don’t produce low-spec base models for the fun of it; they’re often an important marketing tool that’s not expected to sell particularly well with retail buyers. There are two main reasons why auto manufacturers produce stripped-down, no-frills base models of their vehicles.
The first is so they can advertise a model starting from a very low starting MSRP that will catch the attention of buyers, and the other reason they produce them is to cater to large fleet buyers such as rental companies.
Believe me when I tell you that one of the very worst things you can do when buying a new vehicle is to choose a base model and then pay extra for additional features from the options list. If a base model doesn’t have all the features you need then spend the extra to get a higher trim level, or if that’s outside your budget then look for an alternative model, perhaps even something from another brand.
If you’re a rental company or a fleet manager buying a large number of the same vehicles your main priority will be sticking to your budget. You’re not going to be bothered if the base model is doesn’t have rear park assist or heated front seats as long as it’s the right class of vehicle at the right price.
I’ve written thousands of vehicle description articles and reviews for car dealerships across the US and Canada over the years. I’ve lost count of the number of times I’ve written something like “but you’re unlikely to come across this model on dealer lots or in showrooms” about base models, and that’s because it’s true.
Don’t get me wrong, dealers will get you a base model in if you want them to, but even when you do come across a base model at a dealership it will probably have had its specification enhanced in one or more ways. For example, if the standard spec of a base model includes a manual transmission it’s almost certain the dealer will have ordered it with the optional automatic or CVT transmission.
What dealers (and buyers) consider as “essential” features changes over time, and if a base model doesn’t have one of those features it’s almost certain the dealer will add it to the base specification when placing the order.
It used to be air conditioning or a rearview camera before they became almost universally standard, but these days it’s often something like automatic emergency braking that gets added to a base-spec vehicle. Personally, I wouldn’t pay a cent extra to have automatic emergency braking and I’d probably prefer not to have it if that was an option for me, but that’s another article entirely for another day.
New and used car buyers are different
You will, of course, know people who swap and change between buying a brand new car one time and a used model another time, but a lot of buyers tend to fall into one of the two camps and stick to it. The argument about whether buying new or used cars is better is another discussion for another time, but you need to understand before you buy a brand new car in a base specification that used buyers are different from new car buyers.
When you’re buying a used car you have much more choice than those buying new. You obviously have a lot of brand new trucks, cars, and SUVs to choose from at any given time, but there are many, many times more of each individual vehicle if you’re buying used.
If you’re looking to buy a new Chevrolet Traverse, for example, the base 2021 model at the time of writing is a front-drive L model costing from $30,995. If that’s the model you want you’ll struggle to find one at a local dealer without placing a factory order, and any you can find in stock will probably have extras to pay for and you’ll definitely be limited to certain colors.
If you want a used Traverse instead you’ll have any number to choose from. You can set your budget and find a Traverse to fit. You can get one a little older or with higher mileage to get a higher specification, or you can get a newer, lower mileage example in a lower specification to get the price to fit your budget. The world is basically your oyster, as they say, but you’re a lot more limited if buying brand new.
The real problem with base model cars
The number one reason why you should avoid buying a brand new vehicle in its base specification is resale value. Because used buyers have so much more choice, you’ll reduce the number of those who will be interested in buying your vehicle from you when the time comes to sell or trade it in.
When a buyer is confronted with two models at a similar price where one is a base model and the other is a slightly older or higher mileage model in a higher trim level, as long as the condition is similar they’ll likely gravitate towards the higher specification.
Your problem you have as a seller of a base model car is the difference in price between trim levels is smaller than it is when they are brand new. In fact, if someone has ignored my advice and bought a base model brand new but paid for extras from the options list they will basically lose the money they spent on those extras.
If you’re looking to sell a base model privately or especially to a dealer as a trade-in it will be valued as a base model even if it has extras. You may get a little more if something really crucial has been upgraded such as the engine or all-wheel-drive has been added, but if you’ve paid extra for leather upholstery or navigation you will still get base model money for your base model.
When buying a base model makes sense
If you’re one of those people who buy a new car and keep it for much longer than the average two to three years then buying a base model might be a decent idea as long as you’re happy with what you get. As your vehicle gets older and older the price reduces and reduces, and eventually, the difference between your L model and an LT will be pretty insignificant.
Those who lease a new vehicle can also go for a base model and not have to worry about the consequences. When you lease a car you hand it back to the leasing company at the end of your agreement so what it’s worth at that point is of no concern to you. As long as the car has what you need and you’re happy with it then leasing a base model would get you the lowest monthly rental for that vehicle.
Potential dangers of buying a base model car
Some might consider it a bold, possibly even alarmist claim to say a base model could be more dangerous than a higher-spec version of the same vehicle, but it could be true. One area where automakers manage to keep the price of base models down is by omitting advanced driver-assist features such as automatic emergency braking, adaptive cruise control and lane departure technology.
If you’ve ever been saved from an accident by these types of features you’ll probably avoid base models that don’t have them at all costs, but even if you haven’t benefitted from them yet it’s still an issue worth considering. If you’re looking at buying a Mazda Miata or something similar, advanced safety tech probably isn’t top of your list of priorities for your new ride.
On the other hand, if you’re looking for a three-row SUV for transporting your family and friends around on a regular basis then that sort of tech is probably of great importance to you. You might be willing to forgo heated rear seats in favor of automatic emergency braking, so a base model probably isn’t going to cut it for you.
Will dealers try to sell you a high-spec model to make more money?
In my considerable experience, most car dealers and sales execs are only interested in selling you a vehicle and they’re not all that bothered about which one it is as long as you buy. While the owner of the dealership might prefer you to buy a Camaro ZR1 instead of a 1LS because the more expensive ZR1 will generate more profit, the sales team are not really bothered as long as you buy something.
Where dealers and the sales team will try to upsell you into a higher spec model is when they don’t have a lower spec or base model in stock. Dealers want to sell you what they have in stock, and as I told you earlier, they’re unlikely to have completely bone-stock base models on their inventory. Of course, the reason they rarely carry the absolute base version of a vehicle is because there’s little demand for such vehicles from retail buyers.
Should you generally avoid base models then?
The truth of the matter is you’ll probably avoid buying a base model of a new car without giving it too much thought. When it comes down to it, the base versions of most mass-market vehicles are not particularly desirable for most buyers. To get their model down to a starting price they think will attract attention, non-luxury automakers will drop a lot of features most modern buyers will probably consider essential.
If you’re not bothered about a decent infotainment system with Apple CarPlay or Android Auto compatibility, keyless entry, climate control or auto on/off headlights then go ahead and buy a base model. The second or third models in a vehicle lineup often don’t cost a huge amount more and they usually represent the best value.
When base models are awesome
I must add a caveat here about base models, and this came to mind because I was writing the other day about the latest BMW X4. If you look at a vehicle like that it’s laughable to refer to the first model in the range as “Base.”
When it comes to some luxury vehicles like BMWs the base model and the top-spec model can be pretty similar apart from the engine or drivetrain. If you don’t have to have a 3.0-liter turbo-six in your new X4 and a turbo-four will do you nicely, then the base model is absolutely sensational and packed with standard equipment.
That’s not the rule across the board with luxury cars though as some base versions of luxury models can still be reasonably sparsely equipped compared to higher trim levels. These are usually the more affordable models offered by luxury automakers, such as the Audi A3 and Mercedes-Benz A-Class.