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You would be able to move up to a 2011/2012 model for the money you have to spend, and for that you get a much safer car, with much lower kilometres, which should be much more reliable. Even though your 20-year-old car has been very reliable, there’s nothing to say that won’t all change tomorrow, and BMWs can be expensive to fix.
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LIKE you, I prefer rear-wheel-drive cars for the way they drive and feel on the road. I'm also in favour of buying used BMWs and Mercedes-Benzes because you get to drive a better car than you might otherwise be able to afford, but they can be expensive to service and repair. For that reason I am loathe to recommend them. But I also agree that some of the cars coming from Japan look good, and I particularly like the new Lancer. I wouldn't be concerned about front-wheel drive at all, there's nothing wrong with the way they drive, handle, steer or brake.
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