I have also thrown in the occasional truck or SUV that might not be the best handling cars, but are perfect in all the other categories and are great for those who desire a truck or SUV. Like my brother, he didn't want a small car like a Mazda3. He wanted a truck. So he got a Toyota Tacoma.
Note: A good way to decide what car out of my choices is best for your teen is the "experience: horsepower ratio." As you might be aware, horsepower is the measure of how much power an engine puts out. When choosing a car for your teen, you must find out how experienced/how good of a driver they are. The more experienced/better driver they are, the more horsepower you could consider your teens car can have.
Note: Before making your final decision on buying your teen their first car, be sure to have them test drive it first. Make sure they like the way it drives. Ask them if they are comfortable steering the car? Are they comfortable sitting in the car? Do they like the feel of the pedals? It may sound stupid to your teenagers, but these questions could actually save their lives. If, for example, a teenager hates the way the cars steers, but you buy it anyway, there is a big chance they could get in an accident.
My Car: Now, what do I drive? Something I would never recommend to a teenager who is inexperienced. My car is a Mustang GT. The only reasons I got it are that I've been driving go karts and off road dirt karts since I was about seven years old and I'm a HUGE mustang fanatic. If your teenager wants a Mustang GT or something with a V8 that is similar, make sure they are experienced. DON'T BUY IT FOR THEM IF THEY ARE NOT. They might be straight A students who have never done anything bad in their lives. It really doesn't matter. They will crash the car within a month if they are inexperienced drivers.
This car perfectly exhibits all of a teenagers needs. It's reliable, it's safe, it has good power, it has great handling, it's got lots of room for storage, and it gets good gas mileage. The perfect car in my opinion for any teenager. The only flaw is the looks. Some people like the smiley face front end and some people don't. If your teenager doesn't like it, look for a pre-2010 model with the old body styling.
Edit December 2013: Thank you Mazda. The 3s only flaw has been fixed. The new Mazda 3 looks 1000x better. However, there is a new flaw: the price. I was able to fully load a new 3 on Mazdas website and got it to nearly $30000. That's absurd for this class of car. However, again, the base price is only slightly more than last generation's.
#2 on The Best Car Valuessee more on Mazda3
Basically, the same same car as it's less performance oriented counterpart the Mazda3, but that's the problem. Some parents won't look at any car with the word "performance" in the description, which is why this car ranks below it.
Edit December 2013: I can't wait to see the new Mazdaspeed3 in person!
#10 on The Top Cars For Teenagers
#3 on The Best Car Valuessee more on Mazdaspeed3
WAIT!!! Before you hit that back button and leave my list, allow me to explain! Believe it or not, Mustangs can be fantastic first cars for teenagers. Look for 2005-present models with the side airbags option. Those cars are top of their class in crash tests. Not to mention good reliability. Mustangs also (as your probably well aware) have great power, performance, and handling (at least compared to the other car on this list). HOWEVER, I would only recommend the V6 engine for a teenager. At the time of writing this, the V6 mustang makes 305 horsepower which is plenty for a teenager. I could only recommend the V8 Mustang to the 0.001% of teenagers that are experienced enough to drive V8 cars. Also, with the V6, the Mustang gets pretty decent, actually fantastic in my opinion, fuel economy for sports car. At the time of writing, it is achieving 19 city mpg and 31 highway mpg. Compare that to the Mazdaspeed3 above with only a four cylinder that achieves only 18 city mpg and 25 highway mpg. Be aware though that these fuel economy numbers are only for 2011-present V6 mustangs. The only downside I have with my Mustang is the practicality. Remember, it's a 2 door coupe, not a sedan or hatchback.
Edit December 2013: The new 2015 Mustang has lost some of the muscle, but definitely not any of the sportiness. The new turbo 4 cylinder Mustang might be perfect for your teenager.
#206 on The Worst Cars Ever Made
#12 on The Best Cars Ever Made
#5 on The Best 1960s Carssee more on Ford Mustang
The Impreza, in ways, is the best alternative to the Mazda3. You get better looks than the Mazda, but there is a trade off; the Impreza does not handle as well as the Mazda3. Also, I recommend the hatch version of the Impreza for extra practicality.
December 2013: Subaru seems to have taken a step backward in styling with the latest Impreza. It has that Legacy inspired from look that I'm not the biggest fan of, but luckily the rest of the car is fantastic and largely underrated.
#213 on The Ultimate Dream Garagesee more on Subaru Impreza
Like the Impreza, it's a better looking Mazda3. And, like the Impreza, there's a trade off; reliability is not even close to as good as the Mazda3's. However, the Golf has one plus over the Mazda; It's slightly more luxurious.
Edit December 2013: New Golf = Even Better. Everything has been improved in some way, whether it was a marginal or massive change.
#24 on The Best Cars Ever Made
#4 on The Greenest Green Carssee more on Volkswagen Golf
The slightly more performance oriented Mazda6. Even though it has "performance" in the description, parents should not worry. It not all that more powerful than a regular Mazda6.
Also Rankedsee more on Mazda6
The more performance oriented Lancer. In fact, A LOT more performance oriented. Which, again like the Mazdaspeed3, is a problem for some parents. Also, this is one of the more expensive cars on the list, costing, in some cases, more than the 3-series BMW.
#70 on The Ultimate Dream Garagesee more on Mitsubishi Lancer Evolution
Whether you choose the V6 or the V8, this car has great performance. It very practical, it's safe, I personally love the looks, and gas mileage is reasonable (at least on the V6 model)
#1 on The Best 1960s Cars
#24 on The Ultimate Dream Garagesee more on Dodge Charger