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Where has the sub-$20,000 car gone? Only five new automatic models left as Toyota, Mazda, Hyundai, and Ford abandon budget segment

The death of the cheap runabout: Australia's new car market now has only five new sub-$20k auto models on sale.

Yep, you read that right. If you’re in the market for a new automatic car with a budget of $20,000 or under, we’ve got bad news: There are only five brand new automatic car models left.

How can this be? As the first quarter of 2021 draws to a close, Honda’s Jazz once priced from $18,690 before on-road costs has finally ended its tenure in the Australian market, and currency-driven quarterly price increases have pushed the entry-level Suzuki Swift GL Navi auto (previously $19,990) to $21,490.

This leaves only the Kia Picanto S (from $17,290), Suzuki Baleno GL (from $18,740), Mitsubishi Mirage (ES or LS from $16,490), MG3 (Core or Excite, from $17,490), and Suzuki Ignis GL (from $19,740) in automatic form left in the sub-$20,000 segment.

Only two options on that list have any form of modern active safety, with the Mirage and Picanto possessing city-speed auto emergency braking.

Mitsubishi's Mirage has experienced better sales as its competitors vanish. Mitsubishi's Mirage has experienced better sales as its competitors vanish.

If you can still drive a manual, there are still a few other compelling options available with MSRPs under $20,000 in the form of the Suzuki Swift, Kia Rio, Fiat 500, and Volkswagen Polo, although there are no utes or sedans left in this price bracket.

With five remaining autos, the light car segment has all but been abandoned by the major players, although some consumer demand still lingers with the MG3’s relatively attractive offering and seven year warranty now dominating what’s left of the market share.

The general trend toward higher safety standards and the rise of the more expensive light SUV has seen once popular nameplates take a price hike or leave Australia altogether. The most recent of which is the Jazz which won’t be replaced, but other casualties in recent years include the Hyundai Accent (replaced by the Venue light SUV), Ford Fiesta (continues only in go-fast ST form), and Nissan Pulsar (never replaced). Meanwhile once-affordable nameplates like the Kia Rio, Suzuki Swift, and Mazda2 have been priced out by year-on-year spec increases and currency fluctuations, and Toyota’s new-generation Yaris has chosen a more upmarket starting position of $23,630 for the Ascent Sport auto.

The new-generation Jazz won't be coming to Australia as Honda faces pricing and logistics pressures. The new-generation Jazz won't be coming to Australia as Honda faces pricing and logistics pressures.

Overall the micro car segment contracted by over 30 per cent, the light car segment contracted by almost 45 per cent, and the small car segment decreased over 25 per cent during the course of 2020 according to VFACTS figures.

Indeed, Kia’s chief operating officer, Damien Meredith, told CarsGuide last year that while the brand hopes to capture more of the light car market segment with its recently updated but aging Picanto, the sub $20,000 bracket “will be a desert by the middle of the decade”.

Even MG’s newfound light car dominance could come to an end with the MG3 set to be replaced by something different and possibly electrified in the coming years. “A new-generation vehicle is on the way.” the brand’s marketing boss Danny Lenartic told CarsGuide in 2020, “we’re not sure what that might look like. Electric is a possibility”.

The MG3 continues to dominate the small car market, but even its days might be numbered... The MG3 continues to dominate the small car market, but even its days might be numbered...

No matter which way you cut it, it’s not a great time to be in the market on a budget, with fewer than ever sub-$20,000 options and a surging used car market.