The new car has cost £50,000 excluding VAT and will transport mayor Councillor Mohammed Nazir to formal engagements and events.
It comes after Walsall Council announced it needed to make £19 million of cuts, slashing 332 jobs.
Under plans the deputy mayor's car, a Jaguar Sovereign Executive which dates back to 1996, will be scrapped.
Walsall Council spends £50k on mayors new car
Opposition councillors are calling for the mayor to make a stand against the 'appalling' expense.
But Councillor Nazir says it was not his decision to buy the car – and has insisted he will carry on with his civic duties as planned.
Independent councillor Paul Bott said: "We are calling on the mayor to boycott the car and show solidarity with the people of Walsall.
"The decision is appalling – our staff are being made redundant, there are health resource centres being closed and people are struggling to pay their bills and council tax.
"This is a totally appalling decision that has been made. With the austerity people are facing at the moment, this is just a complete smack in the face to our employees and members of the public."
But Councillor Nazir said: "This is the council's decision which the mayoralty has no say in.
"The old car needs a lot of money spending to maintain it. It's a case of choosing whether we want the mayorality or we want to say goodbye to 636 years of tradition.
"It's not my decision so all I'm doing is continuing with my civic duties and my aims, which include upholding tradition and unity in the community."
There was uproar two years ago when the council revealed it was going to use agency drivers rather than its own chauffeurs under money saving measures.
Council leader Mike Bird said: "Replacing the mayoral car at this stage of its life is the most cost-effective thing to do, so as to avoid greater maintenance costs in the future.
"We feel it's important to retain the significance of the mayor's role here in Walsall.
"The mayor goes back to the 1200s. At the end of the day the mayor is the Queen's representative in the borough."