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I am looking to purchase a small car for mainly around town running. Have tended to look at a Toyota Yaris or something similar around 1500cc. and from 2006 - 2009 age group. What is the differnce between a automtaic and 5 speed manual in terms of ease of driving, maintenance and reliability

The Yaris is a very good choice for around town driving.

For most motorists who are driving around town on a regular basis, an automatic is the transmission of choice by a wide margin. The constant need to manually change gear around town soon wears thin for the majority of drivers.

Resale values would also be better for automatics.

Manual transmissions are pretty much bullet proof reliability wise however a late model low mileage auto is not going to cause you too many problems. The extra maintenance costs would a transmission fluid change but that is not a regular requirement and not overly expensive.

If you were buying a high mileage and old vehicle, then your mind starts to think about things in a slightly different way and the auto becomes a higher risk. In your case however I think the auto is the way to go.