1.8 Million Off-Lease Vehicles Returning to the Market in 2016, Experian Reports
The amount of cars being leased has grown by 76% since 2008, according to an Experian Automotive study. By the end of 2016, 1.8 million off-lease vehicles will return to the market, the firm says.
LAS VEGAS — According to a new study from Experian Automotive, leasing as a financing option for new vehicles has grown by 76% since 2008. Based on that finding, the credit reporting agency said 1.8 million off-lease vehicles will return to the market by the end of the year.
The top three demographic areas, according to the study, with vehicles coming off lease are New York, Los Angeles and Detroit.
“With such a large volume of vehicles coming back into the market, consumers, dealers and lenders will want to better understand the options available to them so they are able to take action,” said Melinda Zabritski, senior director of automotive finance for Experian. “Whether it is deciding to lease again or buy used, restocking inventory or marketing to potential borrowers, gaining insight into these trends will provide the knowledge necessary to make smarter decisions for all parties involved.”
The firm said the study shows a shift in consumer preference for leased vehicles. Preferences include entry-level crossover utility vehicles, standard midrange cars, lower midrange sedans, near-luxury/upscale vehicles and premium crossover utility vehicles.
In contrast to that, comparing vehicles currently being leased to those coming off lease shows that the amount of leased full-size pickups and entry-level sport utility vehicles has grown by 56% and 79% respectively.
“As vehicle prices have been on the rise, we have seen consumers using several tactics to keep their payments more manageable. Leasing over the past several years has grown as consumers are drawn to the lower monthly payment,” Zabritski says. “What’s interesting, however, is that the types of vehicles are changing. Instead of fuel-efficient hybrids, consumers now are leasing full-size pickups, SUVs and CUVs. So, what happens three years from now? Will gas prices be what they are today, or will dealers have a more difficult time moving these types of vehicles when their leases mature?”
The top leased vehicle returing to market include the Toyota Camry, Honda Civic, Honda Accord, Toyota Corolla, Honda CR-V, Ford Escape, Nissan Altima, Ford Fusion, Lexus RX 350 and Toyota RAV4. Combined, these vehicles represent 28% of all leased vehicles returning to market.
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