We've reached the turn of the millennium, and we're once again looking for a first car for a new 16-year-old driver. The budget is still $20,000 in 2025 dollars, which gives us $10,700 to spend. Our hypothetical driver was born in 1984.
Criteria are tougher than in 1995. The 1990s saw massive gains in car safety and our new driver should benefit from this. We now require front airbags for both driver and passenger, ABS, a 4 or 5-star NHTSA frontal crash test rating, a NHTSA side-impact rating of at least 3 stars, and an IIHS offset rating of Acceptable or Good. And, of course, basic quality-of-life features like an AM/FM radio, heating, and A/C.
VW New Beetle - In 1975, getting your kid a little VW Beetle to start out on wasn't a good idea, as the tiny cars with a then three-decade old design were very unsafe on roads that were filled with full-size American cars. A quarter-century later, however, the New Beetle made an excellent choice for a new driver. It was a tight squeeze on the $10,700 budget, but doable, especially if one picked a lower-spec (GL trim) from the introductory model year of 1998. For that, you got standard dual front AND side-impact airbags, optional ABS, and stellar crash test ratings: high-end 4 star for both front occupants in the NHTSA frontal test, a full 5 stars for front seat occupants' side-impact protection (3 stars for rear), and a Good IIHS offset rating. Add in the uber-cool design and it's clear that this was one of the best cars available for a Y2K-era teen.
Ford Taurus (1996 or newer) - The Taurus was a perennially good choice for a new driver, and the 3rd generation model gets the nod here. It had dual front airbags and optional ABS, and the '96 scored a high-end 4-star for both driver and passenger in the NHTSA frontal crash test, 3 stars in the NHTSA side impact test, and a Good rating in the IIHS offset. An ABS-equipped '96 with about 40-50k miles typically ran from about $7,500-9,500 depending on options, which left you with some wiggle room for lower mileage and/or a newer model year.
Toyota Camry (1997 or newer) - The 4th-generation Camry, introduced in 1997, set new standards for refinement and build quality in the midsize sedan class. It also set new standards for safety, scoring 4 stars for driver and passenger in the NHTSA full-frontal test, 3 stars for both front and rear occupants in the NHTSA side impact test, and a Good rating in the IIHS offset. LE models with the optional ABS started around $9,000.
Side note: Because the Camry of this era was well-known for its legendary reliability, it may have been a good idea to stretch the budget a bit, knowing you likely wouldn't have to fix anything major for many years. The 1998 Camry, with its depowered front airbags, improved on the 1997 with a high-end 4 stars for the driver and a full 5 stars for the passenger in the NHTSA full-frontal test. Side-impact airbags were a newly available option for 1998, and they improved the NHTSA side-impact rating to 4 stars for front occupants. A '98 Camry with ABS and side-impact airbags could easily be found in the $11,500-12,000 range.
Chevy Lumina (1995 or newer) - '90s GM was known for being able to make both gold and crap, depending on the model. The 2nd generation Lumina fell into the 'gold' pile. This big, comfortable sedan had standard dual airbags, and ABS was standard from 1996 on (it was an option on base '95s and standard on the uplevel LS). It earned 5 stars for the driver and 4 stars for the passenger in the NHTSA full-frontal test, 4 stars for front occupants and 3 stars for rear occupants in the NHTSA side impact, and a Good IIHS offset rating. Because of its staid image, it depreciated like a rock; a '95 with ABS could be had as cheaply as $5,200! For better long-term reliability, a newer model would be preferable; a 1998 would be around $10,000, still fitting into the budget.
Volvo 850 (1995 or newer) - In 1995, the Volvo 850 was the safest car ever built, short of some high-end luxury cars. A half-decade later, it was one of the best cars you could get a new driver. It had standard dual airbags, ABS, and Volvo's innovative SIPS system; side-impact airbags were standard on 1995 turbo models and all 1996 and newer models. It earned 5 stars for the driver and 4 stars for the passenger in the NHTSA full frontal test, 4 stars for the driver in the NHTSA side test (there was an instrumentation failure for the rear passenger, but given Volvo's sterling reputation, the rating would probably be good back there too), and a Good IIHS offset rating. A side-impact airbag equipped model started just under $10,000.
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