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It’s coming time to replace my wife's old Corolla with a new small car.

For the sake of the discussion we are considering a VW Golf TSI, Toyota Corolla diesel and a Hyundai i30 diesel. I really like the VW however I have seen reports that as the Euro cars get older, insurance premium costs are significantly higher than the equivalent Japanese (or Korean) car. The reason is put down to the cost of parts and technology in the car.

I can't really see why the technology has that much impact. All the above cars have ABS, stability control, airbags, CD players, air-con etc and the diesel variants have a turbo as well.

We tend to keep our cars for some time, well over 100,000km's but I wonder whether the long term economics stack up for the VW, even though it is a fabulous car.

What do you think?

Andrew

From the "Ask Jack" archives - 29 July, 2010

For many in the industry this is a no-brainer, the Golf would win hands down. It is a fantastic piece of engineering and the car drives beautifully. Our understanding is the car is in hot demand and there is a waiting list in some dealers.

We have driven the car and are planning to post a review on our website in the next few weeks. There will be few negatives to report.

Apart from the high-tech engine it is also fitted with what is called a DSG transmission (a manual transmission operated electronically) which is pretty awesome to experience.

I’m unsure about the reasons for the higher insurance costs because as you say, all new cars have similar technology as far as safety features go.

I do understand your nervousness in regards to long term ownership of this vehicle however. The Euro’s do have a tendency to cost more to maintain over a long period. As you have no doubt discovered with your current Corolla, the mainstream Japanese vehicles simply keep going and overall have a much better reliability record.

To confuse you even more, apart from price (Toyota do some unbelievable deals), I don’t find the Corolla diesel a very exciting car at all. Certainly nowhere near the VW in terms of appeal or driveability. It is only available as a manual which may not worry you too much but it has not been a great seller for Toyota no doubt held back because of the lack of a auto option.

So that leaves the Hyundai i30. This was the AA’s supreme winner in our 2009 Motoring Excellence Awards. Hyundai have made massive gains into the global market in recent years and their climb up the sales charts in NZ has been nothing short of amazing. Certainly worth a good look. It almost takes the middle ground between the more highly engineered VW and the rather unexciting Toyota.

If it comes down to price I can’t see Toyota being beaten especially on a Corolla diesel. VW will not discount much if their product is in high demand while Hyundai will definitely work hard to make a sale happen.