(MONEY Magazine) – Driving instructors like to warn anxious students of the perils of tunnel vision. On the road, it's the big picture that counts. Would that more consumers heeded that lesson at car-shopping time. Like last year, 2003 is shaping up to be a car buyer's market, with cash rebates, low-to no-interest financing and deals galore. The trap is in becoming so hypnotized by incentives that you forget the real task at hand: choosing the very best car or truck.

Consumers always ask me what model they should buy. Without knowing their needs, what I tell them is this: Buy a car you really love. Use your brain, but go with your gut. That doesn't mean buying a crimson Corvette when a family hauler is called for. It does mean trusting the instincts you've developed as a lifelong consumer.

Now, every automotive infatuation should be backed up with facts and old-fashioned expert advice. That's where our 2003 Car Guide comes in. We've chosen the best of the year's models plus a runner-up in 11 vehicle categories, based on extensive test drives and research. Our criteria will be familiar to any consumer and include design, quality, value, performance, comfort, safety and fuel economy. Eight pages of tables list important data on more than 400 popular vehicles.

Cruising for a great deal

Being MONEY magazine, we care about prices. But remember, frugal doesn't always mean cheap. Nothing frustrates me more than seeing otherwise savvy consumers put in the hard work, scouring magazines and the Internet to find their perfect vehicle--only to second-guess themselves and buy some mediocre model they weren't even considering because they were offered a "deal."

If you can find low-interest financing or cash back on a model you truly believe in, more power to you. And even if you've landed a low-interest loan, dig harder and see what other discounts the dealer will offer. As of January, rebates and other incentives were averaging about $2,900. And with 3.5 million unsold vehicles littering car lots, some automakers are so desperate that they'd probably take on your household chores to unload one.

"Unload" is the operative word. As you might expect, the most irresistible deals are often attached to what should be the most resistible models. "A lot of consumers are getting suckered in," says Art Spinella of CNW Marketing Research. "They're thinking only of the initial deal and forgetting to look at the [resale] price four or five years down the line."

Unless you're planning to drive a car into the ground, expect the less esteemed, heavily discounted model to take a bigger bite out of equity at resale time. Here's an example: A popularly equipped 2003 Ford Taurus SE carries a manufacturer's suggested retail price (MSRP) of $21,005 vs. $20,460 for a comparable Honda Accord LX. But an average $2,145 discount on the Taurus drops the actual transaction price to $18,860, while Honda isn't offering a dime in rebates on the '03 Accord. The Taurus looks like a bargain, right?

Some bargain. After three years, expect a typical dealer to offer just $6,931 for the Taurus, according to projections by the Automotive Lease Guide. And the Accord? It will be worth $11,048 after three years. The initial $1,600 you saved on the Taurus has been washed away, and you're actually $2,500 in the hole.

After five years, the Ford will have depreciated 78% to $4,621. The Honda will have dropped 60% to $8,184, about $3,600 more than the Taurus. (For more five-year projections, see the tables starting on page 112.)

In other words, the Taurus' discount is simply what Ford must offer to keep these cars moving in a marketplace that places less value on them. There's no free lunch. No free wheels either.

So while your brain is going over the fine print, make sure the car can also quicken your pulse. That's how we assembled our list. Like most folks, we've a soft spot for the latest and greatest--but only if those rookies bring superstar credentials to their fields. Lacking that, we're not shy about crowning living legends like the BMW 5-Series. Even in the economy segment, where price rules, models like the Toyota Corolla prove you can be budget-conscious and still drive a wonderful car. Use our picks, compare them with your own and bask in the car shopper's paradise of 2003.

The year's best buys

Best Economy Car: Toyota Corolla BASE PRICE: $13,570-$15,480 ENGINE: 1.8-LITER INLINE 4, 130 HORSEPOWER FUEL ECONOMY: 32 MPG CITY/41 HIGHWAY

My Corolla conversion came on a long trek from Savannah to Detroit. Somewhere around the Kentucky border, I knew that this was the world's most perfect budget sedan. Whereas most econoboxes remind you of how little you spent, the Corolla feels as if it belongs in a higher bracket. The rich-looking interior raises the bar for affordable cars. On paper, the four-cylinder engine puts out a modest 130 horsepower, yet sophisticated variable-valve technology gives it surprising thrust, along with excellent fuel economy. As with the mid-size Toyota Camry, the exterior looks like it's got a mild case of the mumps. But when an inexpensive car is executed this well, aesthetic quibbles are almost beside the point.

Runner-Up: Hyundai Elantra GT BASE PRICE: $14,949 ENGINE: 2-LITER INLINE 4, 135 HORSEPOWER FUEL ECONOMY: 25 MPG CITY/33 HIGHWAY

With each new model, South Korea's Hyundai has been rebuilding a reputation once defined by abysmal quality. Sales are soaring, and cars like the Elantra GT are proving that's no fluke. Peppy and well-built, the Elantra GT exemplifies Hyundai's sound strategy: Pile on more features than the competition, charge less, and reassure consumers with a 100,000-mile power-train warranty.

Best Mid-Size Sedan: Mazda6 BASE PRICE: $18,530-$21,100 TOP ENGINE: 3-LITER V-6, 220 HORSEPOWER FUEL ECONOMY: 20 MPG CITY/27 HIGHWAY

Everyone's heard the tale of the beleaguered guy--or gal--forced to trade a beloved sports car for a family sedan. Well, cheer up, Mario: The brand-new Mazda6 is the furthest thing from ball-and-chain domestic servitude. Sure, the 6 has a practical four doors, a useful back seat and a stroller-friendly trunk. Hint: Make these talking points for dinner-table negotiations. Avoid such phrases as "drives like a German sports sedan," "sings like a lubed canary" and "chassis as solid as Steve McQueen," though each is demonstrably true. The top-level 220-horsepower V-6 emits ear-tickling sounds, and the five-speed manual transmission is a velvety delight. Throw in a sprinter's stance, a striking interior and an affordable price, and the 6 becomes a testament to what makes a great marriage: the art of compromise.

Runner-Up: Volkswagen Passat BASE PRICE: $21,750-$37,900 TOP ENGINE: 2.8-LITER V-6, 190 HORSEPOWER FUEL ECONOMY: 22 MPG CITY/31 HIGHWAY

Call us traditionalists, but despite the redesign of the estimable Honda Accord, we continue to prefer the Passat. Six years after its last major redesign, the VW's much copied styling still looks elegant and fresh. The interior set a deluxe standard for family cars that has yet to be topped. The driving experience speaks of German character, though admittedly so does the price: Uplevel V-6 models can top $30,000, straining many families' budgets.

Best Sport Sedan: Infiniti G35 BASE PRICE: $27,100-$34,220 ENGINE: 3.5-LITER V-6, 260 HORSEPOWER FUEL ECONOMY: 19 MPG CITY/24 HIGHWAY

Is the new Infiniti G35 really a better car than the BMW 3-Series? Um, no. So what's it doing atop our sport sedan list? Unparalleled value. The G35 will run you about $7,000 less than a comparably equipped 330i. The Infiniti has more cojones, at 260 horsepower vs. the 330i's 225. The G35 also bests the Bimmer with a commodious back seat and trunk. Both the sedan and the showstopping G35 coupe are built on the bones of the hot-handling Nissan 350Z sports car. Perfection is denied by middling interior designs. But that venial sin is redeemed by the price: No sedan in the low-$30,000 range can match the G35's performance and panache.

Runner-Up: BMW 3-Series BASE PRICE: $27,800-$42,900 TOP ENGINE: 3-LITER INLINE 6, 225 HORSEPOWER FUEL ECONOMY: 20 MPG CITY/29 HIGHWAY

Forget human cloning. The automaker that figures out BMW's DNA will rule a cult of sport-sedan converts, identified by lead feet and depleted wallets. Until then, the 3-Series still guards its knotted secrets: How can a car flex this much handling muscle and still ride so sweetly? What makes a relatively small six-cylinder engine so eager to hustle into the next bend? One cat is out of the Bavarian bag: The 3-Series is expensive as hell, more so if you insist on "luxuries" like a decent audio system. In its defense, BMW rewards loyalists with outstanding resale value.

Best Luxury Car: BMW 5-Series BASE PRICE: $37,600-$51,800 TOP ENGINE: 4.4-LITER V-8, 290 HORSEPOWER FUEL ECONOMY: 18 MPG CITY/24 HIGHWAY

Even with a crisply redesigned model coming this fall, the 5-Series remains sui generis among sedans. Where most luxury cars ask little of their drivers, the 5-Series has needs--some passion, some involvement. The BMW repays those attentions, complimenting a light touch here, a firm hand there. Soon you're in cahoots, a boy (or girl) racer who just happens to drive a mature, classically understated German luxury sedan. My own 5-Series flings always feel heartbreakingly brief, whether I'm on a Sunday drive in the 540i or setting canyons ablaze in the exclusive 394-horsepower M5, a car that can make a Porsche sweat and still carry your pals and a trunkful of Callaway clubs.

Runner-Up: Lexus LS 430 BASE PRICE: $54,925 ENGINE: 4.3-LITER V-8, 290 HORSEPOWER FUEL ECONOMY: 19 MPG CITY/25 HIGHWAY

The antithesis of the sporting BMW, the LS 430 is still a magnificent luxury car. Sure, it's a bit of an isolation chamber. But if my senses can be treated to this much lacquered wood and creamy leather, sign me up for the tank. There's no better vehicle for measuring out highway miles by the hundreds. Critics who suggest that the Lexus has no soul miss the point. The Lexus has a soul, all right, but it's that of a private banker: buttoned-down, reliable, mindful of the bottom line and never ostentatious. Qualities that other luxe machines would do well to emulate.

Best Sports Car: Chevrolet Corvette BASE PRICE: $43,335-$51,135 BASE ENGINE: 5.7-LITER V-8, 350 HORSEPOWER FUEL ECONOMY: 18 MPG CITY/25 HIGHWAY

Few cars can claim icon status. The all-American Corvette is one. But blowing out (blowing off?) candles on its 50th birthday, the Corvette is no museum piece. NASA-like acceleration, tremendous brakes and world-class handling leave the Corvette with no competition near its price. That's especially true of the fierce 405-horsepower Z06 coupe, but even the 350-horsepower coupe and convertible are stupid fast. A limited 50th-anniversary edition offers special ruby-red paint, plus a sophisticated magnetic suspension that can adjust for curves and bumps as fast as you can cover one inch of roadway at 60 mph. And unlike so many high-testosterone models, the 'vette is a sports car for every day, with a supple ride, luggage-hungry hatch and surprising fuel economy. I've managed up to 27 mpg on highway drives, amazing for a sports car that can reach 175 mph.

Runner-Up: Porsche Boxster BASE PRICE: $42,600-$51,600 TOP ENGINE: 3.2 LITER FLAT 6, 258 HORSEPOWER FUEL ECONOMY: 18 MPG CITY/26 HIGHWAY

The Boxster is an alfresco delight, among the purest expressions of the sports-car philosophy. A mid-engine design helps give this two-seater a gymnast's balance and the ability to recover from a misstep. Power is up slightly for '03, and the front end gets a mild makeover. The price seems steep--until you hit that first twisty road, at which point you'll drive the Boxster like you stole it.

Best Compact SUV: Jeep Liberty BASE PRICE: $17,510-$23,970 TOP ENGINE: 3.7-LITER V-6, 210 HORSEPOWER FUEL ECONOMY: 19 MPG CITY/23 HIGHWAY

The Jeep Cherokee may have been a clunky relic, but that didn't stop some loyalists from scoffing at its shapely replacement. Too cutesy, not manly, went the refrain. But the Liberty promptly soared to the top of the sales charts, and for good reason. The Liberty isn't cute, it's downright handsome, a standout among alternately bland or gawky rivals. It remains every inch a Jeep, as it proved by fording steep-banked streams, climbing boulders and churning the red Virginia mud of Camp Jeep's grueling off-road trails. Towing capacity tops the class. But the Liberty cleans up nicely, with a composed highway ride and a well-designed interior with loads of cargo space. The beefy steel-reinforced chassis puts the Jeep on the chubby side, taking a toll on fuel economy. But where some cute utes feel toylike, the Jeep feels substantial.

Runner-Up: Honda CR-V BASE PRICE: $18,900-$22,400 TOP ENGINE: 2.4-LITER INLINE 4, 160 HORSEPOWER FUEL ECONOMY: 21 MPG CITY/25 HIGHWAY

A six-pack of cylinders used to offer a competitive edge among small sport utes. But when a four-cylinder is as smooth, gutsy and efficient as the CR-V's, there's no need to pick six. The CR-V steps out smartly, hugs curves and treats occupants with Honda hospitality. Styling may veer toward the bland side of the curb, but topnotch quality, fuel economy and resale value make this pint-size hauler a star.

Best Mid-Size SUV: Toyota 4Runner BASE PRICE: $27,205-$36,480 TOP ENGINE: 4.7-LITER V-8, 235 HORSEPOWER FUEL ECONOMY: 14 MPG CITY/20 HIGHWAY

All the crocodile tears being shed over SUVs are obscuring how good--and how versatile--they have become. The redesigned 4Runner is a stellar example, a jack-of-all-trades that masters each one. Built on an old-school steel-frame chassis, this is a no-apologies truck with hardcore off-road skills. But you'd never know it around town, where the Toyota is so polished and effortless you'd swear you were driving a family sedan on stilts. It's also one fine-looking truck, masculine but not over-the-top macho. The V-6 model is good enough, but the eight-cylinder borrowed from the full-size Toyota Sequoia delivers a torrent of silky power unmatched in this class. Clever gizmos abound, including a downhill assist control that lets the 4Runner walk down even steep, slick grades with no need to touch the gas or brake. A top-shelf Limited model can reach $40,000, but compared with its plush sister, the $50,000-plus Lexus GX 470, the Toyota is a relative bargain.

Runner-Up: Acura MDX BASE PRICE: $35,700-$42,000 ENGINE: 3.5-LITER V-6, 260 HORSEPOWER FUEL ECONOMY: 17 MPG CITY/23 HIGHWAY

Confession: The MDX is a bit tame for my truck tastes. But I deeply respect and trust the Acura, based on the Odyssey minivan. Upped to 260 horsepower, the MDX has the Zenlike simplicity, precision and purpose that mark every great Honda product. And there's no denying that this type of crossover SUV is becoming a preferred mode of transport for folks who think "tough trucks" belong in the kids' sandbox.

Best Large SUV: Land Rover Range Rover HSE BASE PRICE: $71,200 ENGINE: 4.4-LITER V-8, 282 HORSEPOWER FUEL ECONOMY: 12 MPG CITY/17 HIGHWAY

No one needs a $71,000 SUV. Wants is another matter, and affluent types beset by fox-chasing Ralph Lauren fantasies will sound their horns over the new Range Rover. Designed and executed largely by BMW--before it dispatched Land Rover to new owner Ford--the Range Rover is leagues ahead of its fossilized, trouble-prone predecessor. Switched from a truck frame to a car-based design and powered by BMW's forceful 4.4-liter V-8, the Range Rover keeps its legendary off-road skills while improving its highway manners. But the real lure for the Rodeo Drive set is the English-manor interior, with its wood-pillared console and gorgeous color and trim combinations. (Make mine the burled walnut with parchment leather and navy-blue piping.)

Runner-Up: Ford Expedition BASE PRICE: $31,520-$41,315 TOP ENGINE: 5.4-LITER V-8, 260 HORSEPOWER FUEL ECONOMY: 13 MPG CITY/17 HIGHWAY

The all-new, precise-handling Expedition places second among the big bruisers, ahead of notable competitors like the Chevrolet Tahoe. The Expedition's cleverly designed rear suspension carves out a third-row seat that's roomier and more comfortable than almost anything in the class. The Ford's city cousin, the Lincoln Navigator, adds niceties like power running boards and a power-folding third-row seat, along with a modern interior straight out of Architectural Digest.

Best Minivans: Dodge Grand Caravan and Chrysler Town & Country BASE PRICE: $22,635-$38,965 TOP ENGINE: 3.8-LITER V-6 215 HORSEPOWER FUEL ECONOMY: 18 MPG CITY/24 HIGHWAY

With the all-new Nissan Quest and Toyota Sienna on the way (see "Best of the New" on page 109), the minivan segment is about to get a vigorous shaking. But until they put up their dukes, the fight goes to Dodge and its Chrysler cousin, with their ultraquiet cabins, comfortable seats and excellent handling. Minivans may be cooling off as a category, but driving the Dodge or Chrysler reminds you how terrifically useful they are. Forget the silly suburban stigma: The average SUV announces your married-with-kids status as loudly as anything else. The Grand Caravan's swept-back styling can grow on you, and the leather-clad captain's chairs are as comfy as the seats in many luxury cars. An optional power liftgate, a Chrysler first, is perfect for the grocery-bag challenged.

Runner-Up: Honda Odyssey BASE PRICE: $24,400-$30,400 ENGINE: 3.5-LITER V-6, 240 HORSEPOWER FUEL ECONOMY: 18 MPG CITY/25 HIGHWAY

I know what you minivan fans are thinking: third-row disappearing seat. Yes, the Honda has one, the Grand Caravan doesn't. That rear seat is certainly a trick feature, and if tipping it down tips the balance, by all means choose the Honda. Or choose it for Honda's reputation for quality, or the 240 horsepower of its V-6 engine. The Odyssey is the kind of stalwart hero that might have inspired Homer to poetic heights. That is, if Homer had had a brood of kids to cart around.

Best Station Wagon: Audi A4 Avant BASE PRICE: $27,700-$33,290 TOP ENGINE: 3-LITER V-6, 220 HORSEPOWER FUEL ECONOMY: 18 MPG CITY/25 HIGHWAY

Judging from auto shows around the world, automakers are obsessed with vehicles that can handle chores without causing snores. They might want to check out the Avant wagon. Practical and fun, the Avant also manages to be more stylish than many of the freakish car-truck blends being hatched from the auto labs. Redesigned in 2002 along with the A4 sedan, the Avant has grown larger and more luxurious. The trade-off is hundreds of pounds of added weight that has blunted some of its sporty flair. But the power-hungry can find the S4 Avant beginning this spring with 340 all-wheel-drive horsepower from its 4.2-liter V-8.

Runner-Up: Ford Focus Wagon BASE PRICE: $17,165-$17,510 ENGINE: 2-LITER INLINE 4, 130 HORSEPOWER FUEL ECONOMY: 25 MPG CITY/31 HIGHWAY

An affordable wagon doesn't have to be a penalty box, as proved by the Focus. The Focus' tall-roof design has been emulated by esteemed rivals like the Honda Civic, and its space efficiency is most apparent in the wagon: A whopping 134 feet of interior volume is more than you'll find in a Ford Escape SUV. Yet the Focus wagon thumbs its nose at SUVs with its sprightly performance and excellent fuel economy.

Best Pickup: Dodge Ram BASE PRICE: $18,330-$28,950 TOP ENGINE: 5.9-LITER V-8, 345 HORSEPOWER FUEL ECONOMY: 14 MPG CITY/19 HIGHWAY

The roomiest cab, the strongest engine, the biggest brakes, the best ride and handling--no wonder the Ram tops our pickup roster. Beginning in January, the standard Ram got the spinach it needed to beat up the bullies from Ford and Chevy, with the long-awaited, 345-horsepower Hemi engine first introduced in the Ram Heavy Duty. The Hemi emits a barrel-chested sound, while its deep well of power lets the Ram tow a boat or trailer with breathtaking ease. Off the range, the Ram impresses with its quiet cabin, abundant storage and civilized road manners. And while the back seat in some standard pickups is best suited to the hound dog of country and western lore, the Ram's rear quarters can handle long-legged adults. The Dodge's signature big-rig styling may be an acquired taste, but so is small-batch bourbon, and neither is for sissies.

Runners-Up: Chevrolet Silverado and GMC Sierra BASE PRICE: $18,191-$34,578 TOP ENGINE: 5.3-LITER V-8, 285 HORSEPOWER FUEL ECONOMY: 16 MPG CITY/21 HIGHWAY

The full-size pickup segment heats up later this year, with Nissan's 2004 Titan going on sale, along with a formidable redesign of the Ford F-Series, America's best-selling vehicle for 21 years. Even then, the Chevy (and its GMC stablemate) will remain a solid choice. Smooth, powerful and capable, the Silverado is the kind of truck you want with you on a back road in coyote-howl country. Front-end styling is new for '03, and more models are available with Quadrasteer, the four-wheel steering system that gives these big pickups the turning circle of a typical family sedan.

ADDITIONAL REPORTING BY DIANA GARBER, MEGAN JOHNSTON AND DEREK MANSON