Wheel Deal: December
From December 2005
Community Comments
Spark a community dialogue. Be the first to contribute by adding your comments.
New Lease on Life, Resale Pricing Revives Interest
By Art Garcia
Auto leasing is making a comeback after slumping in the early 2000s, thanks to higher interest rates, long-term expectations of higher prices for used cars and lessons learned in predicting more realistic residual, or resale, used-car values.
The higher the expected residual on cars turned in at the end of a lease, the lower the monthly lease payments. Manufacturers, finance companies and banks, however, were painfully off the mark. Additionally, the end of the wild summer rebate, zero-interest financing and other incentives, as well as steadily rising interest rates, have some drivers taking a closer look at the lease option.
As 2005 nears an end, the U.S. economy was facing the worst inflation in a quarter century and the Federal Reserve Board in November hiked the federal funds interst rate a quarter point for the 12th consecutive time, raising it to 4 percent.
Leasing’s high point came in 1999, when 37.4 percent of the 14.6 million cars and trucks delivered for retail sale by automakers went into the lease market. California accounted for 39.7 percent of those leased vehicles, reports CNW Marketing Research in Bandon, Ore.
Continued...
The Magazine
Site Links
Prosper Plus +
- Get Prosper Plus to receive e-mail alerts, special event invites, and content that interests you.
Community
- Join the Community and start participating. It's fast. It's easy. It's free.
Advertise on this site! Show your support for the Prosper Network and reach influential thought leaders and web users like yourself. Contact us to find out how.
© 2004-2007 Prosper Media, LLC. All Rights Reserved. Terms of Use | Privacy Policy
The materials on this site may not be reproduced, distributed, transmitted, cached or otherwise used, except with the prior written permission of Prosper Media, LLC.
Community Comments