Gas prices take a toll on car lease business

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Friday, September 05, 2008 5:33:53 PM

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GasBuddy News Article

Gas prices take a toll on car lease business Saturday, July 26, 2008
Los Angeles Times -- High gas prices are stalling the once-popular car leasing business. Chrysler, the nation's third-largest automaker, said Friday that it would stop offering leases on its vehicles through its in-house financing arm beginning late next week. The surprise move, the first by a car company, is an alarming indicator of how the downward spiral in truck and SUV resale values is pummeling the auto industry, especially American makers such as Chrysler, whose product mix is heavy on gas-guzzlers. On Thursday, Ford Motor Co. said it was taking a $2.1-billion write-down on its financing unit, largely because of losses on its lease portfolio. And Wells Fargo & Co., a leading provider of outside auto lease financing, confirmed Friday that it would leave the auto lease business this month.
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JT Moderator	Message Posted: 7/26/2008 6:53:24 AM	Ignore JT Report Abuse
	Saturday, July 26, 2008 Los Angeles Times -- High gas prices are stalling the once-popular car leasing business. Chrysler, the nation's third-largest automaker, said Friday that it would stop offering leases on its vehicles through its in-house financing arm beginning late next week. The surprise move, the first by a car company, is an alarming indicator of how the downward spiral in truck and SUV resale values is pummeling the auto industry, especially American makers such as Chrysler, whose product mix is heavy on gas-guzzlers. On Thursday, Ford Motor Co. said it was taking a $2.1-billion write-down on its financing unit, largely because of losses on its lease portfolio. And Wells Fargo & Co., a leading provider of outside auto lease financing, confirmed Friday that it would leave the auto lease business this month. Visit Los Angeles Times for full article

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POLELANE Champion Author Ohio Posts:1,614 Points:163,000 Joined:Mar 2008	Message Posted: 8/7/2008 3:12:52 PM	Ignore POLELANE Report Abuse
	wonder, wander, I just pay and go on
dmatte85 Sophomore Author Louisiana Posts:107 Points:11,000 Joined:Jul 2008	Message Posted: 8/6/2008 4:47:53 PM	Ignore dmatte85 Report Abuse
	i wonder why?
POLELANE Champion Author Ohio Posts:1,614 Points:163,000 Joined:Mar 2008	Message Posted: 8/6/2008 11:13:24 AM	Ignore POLELANE Report Abuse
	rental prices waaaay up too
FawltyPawl Sophomore Author North Carolina Posts:246 Points:40,500 Joined:Jul 2008	Message Posted: 8/2/2008 9:16:59 AM	Ignore FawltyPawl Report Abuse
	What with gas prices, it is hard to justify a rental car's cost
rumbleseat Champion Author Winnipeg Posts:11,970 Points:2,040,640 Joined:Oct 2002	Message Posted: 8/2/2008 1:51:20 AM	Ignore rumbleseat Report Abuse
	Funny, I mentioned Chrysler in Canada is going to continue to offer leases, because it is working for them. However, GM is cutting out leases in Canada immediately. Different balance of vehicles going out on lease, I guess, which is weird in the same market.
magnumCA All-Star Author Los Angeles Posts:923 Points:191,625 Joined:Jan 2008	Message Posted: 7/28/2008 4:40:18 PM	Ignore magnumCA Report Abuse
	I pay cash for cars
flatcoatfun All-Star Author Orlando Posts:542 Points:157,595 Joined:Nov 2007	Message Posted: 7/28/2008 10:04:18 AM	Ignore flatcoatfun Report Abuse
	Never leased a car and never will!
tr77379 Rookie Author Houston Posts:82 Points:9,145 Joined:Aug 2005	Message Posted: 7/28/2008 9:58:39 AM	Ignore tr77379 Report Abuse
	Good...never saw the benefit to leasing anyway.
DarthDadJr Sophomore Author Virginia Posts:204 Points:38,790 Joined:Jul 2008	Message Posted: 7/28/2008 9:57:59 AM	Ignore DarthDadJr Report Abuse
	...only if is a BIG SUV...try finding a hybrid at a good price!
lindact Veteran Author New Haven Posts:403 Points:98,120 Joined:May 2008	Message Posted: 7/28/2008 9:56:17 AM	Ignore lindact Report Abuse
	Hmmm...may be able to pick up a previously leased car at a good price.
DustyRanch Veteran Author Texas Posts:342 Points:68,300 Joined:Jun 2008	Message Posted: 7/28/2008 9:53:43 AM	Ignore DustyRanch Report Abuse
	Never saw the benefit in leasing.
jeteye Sophomore Author Austin Posts:207 Points:63,155 Joined:Jul 2004	Message Posted: 7/28/2008 9:50:03 AM	Ignore jeteye Report Abuse
	This is strange?
Pede All-Star Author New Jersey Posts:733 Points:95,695 Joined:Apr 2007	Message Posted: 7/28/2008 9:46:02 AM	Ignore Pede Report Abuse
	I never leased a car and do not see how it benefits the person leasing the car, except the lay out of the money to buy the car. This encourages people to spend money on other things that they do not have. It makes no sense to do this thing.
NavyEOD Champion Author Los Angeles Posts:1,580 Points:356,210 Joined:Jul 2007	Message Posted: 7/28/2008 9:42:28 AM	Ignore NavyEOD Report Abuse
	This problem is nation wide.
emosley007 Veteran Author Raleigh Posts:275 Points:27,980 Joined:Jun 2008	Message Posted: 7/28/2008 9:39:25 AM	Ignore emosley007 Report Abuse
	this is very interesting news. but I guess the gas really affects everything that we do.
TONYRON Rookie Author South Carolina Posts:22 Points:508,515 Joined:Sep 2005	Message Posted: 7/28/2008 9:38:31 AM	Ignore TONYRON Report Abuse
	This is not good news at all.
hblee Sophomore Author Ontario Posts:164 Points:200,155 Joined:May 2004	Message Posted: 7/28/2008 9:34:37 AM	Ignore hblee Report Abuse
	Everyone is feeling the pinch. Who can afford to keep the cars. They should reduce the outrageous prices charged at the dealership for repairs. The going rate is over $100/hour for labour. It's insane when the minumum wage is only about $8/hour.
copperhead8 Champion Author Boston Posts:4,869 Points:1,130,945 Joined:Dec 2004	Message Posted: 7/28/2008 9:33:52 AM	Ignore copperhead8 Report Abuse
	You don't have to lease a car if you don't want to.
EarlyMoose Champion Author Seattle Posts:1,556 Points:632,615 Joined:Dec 2005	Message Posted: 7/28/2008 9:32:58 AM	Ignore EarlyMoose Report Abuse
	One more reason to say no to leases.
Lonewolftx Champion Author Houston Posts:5,336 Points:1,050,035 Joined:Sep 2005	Message Posted: 7/28/2008 9:30:48 AM	Ignore Lonewolftx Report Abuse
	They just walk away from them . . .
rbrowdersr All-Star Author Detroit Posts:583 Points:395,310 Joined:Aug 2006	Message Posted: 7/28/2008 9:29:44 AM	Ignore rbrowdersr Report Abuse
	How soon will car rental companies be affected?
pickemup Veteran Author Austin Posts:467 Points:107,895 Joined:Apr 2007	Message Posted: 7/28/2008 9:26:39 AM	Ignore pickemup Report Abuse
	ok...old news
ardmoretoday All-Star Author Oklahoma Posts:500 Points:383,680 Joined:May 2007	Message Posted: 7/28/2008 9:26:16 AM	Ignore ardmoretoday Report Abuse
	It is bad for all business - well unless you are in the "Oil Business" taking money like candy from a baby.
PokerAce Champion Author Louisiana Posts:1,066 Points:220,955 Joined:Jan 2008	Message Posted: 7/28/2008 9:25:58 AM	Ignore PokerAce Report Abuse
	normcrocker---good point...
SeerLV Sophomore Author Las Vegas Posts:234 Points:67,580 Joined:Jun 2008	Message Posted: 7/28/2008 9:24:09 AM	Ignore SeerLV Report Abuse
	Gas guzzlers are now really too expensive.
bicycler Champion Author Ontario Posts:5,717 Points:1,045,870 Joined:May 2005	Message Posted: 7/28/2008 9:23:25 AM	Ignore bicycler Report Abuse
	normcrocker; A point that I never thought of.
normcrocker All-Star Author Tennessee Posts:552 Points:569,390 Joined:Sep 2006	Message Posted: 7/28/2008 9:20:55 AM	Ignore normcrocker Report Abuse
	The largest impact on a decline in leasing will be a shortage of program cars for the used car market.
tomok Champion Author Portland Posts:8,065 Points:643,910 Joined:Aug 2006	Message Posted: 7/28/2008 9:20:36 AM	Ignore tomok Report Abuse
	Gas prices affect all areas of the economy.
Brn2bEvl Veteran Author New York Posts:462 Points:106,950 Joined:Apr 2008	Message Posted: 7/28/2008 9:18:33 AM	Ignore Brn2bEvl Report Abuse
	Everyone is feeling the pinch.
RPetty Champion Author Maryland Posts:4,081 Points:920,770 Joined:Jul 2004	Message Posted: 7/28/2008 9:12:58 AM	Ignore RPetty Report Abuse
	hello, ya think? prices are forcing All Businesses to take a beating...
REVLAW Champion Author San Antonio Posts:1,709 Points:321,785 Joined:Jul 2007	Message Posted: 7/28/2008 9:12:01 AM	Ignore REVLAW Report Abuse
	Some folks seem to be surprised about the far reaching and detrimental aspects of increased energy costs.
roydarecker Champion Author Minnesota Posts:2,566 Points:575,230 Joined:Sep 2006	Message Posted: 7/28/2008 9:10:01 AM	Ignore roydarecker Report Abuse
	ok
CoolFuel Rookie Author Utah Posts:58 Points:12,490 Joined:Jul 2008	Message Posted: 7/28/2008 9:07:40 AM	Ignore CoolFuel Report Abuse
	Leasing was a great option when I got my Ranger in 2001. It kept the monthly payment down and then I bought it after the lease was up. Might have cost me a bit more in interest, but the payments were always really low. Now I'm selling it find the Blue Book is still over $6K. Considered the idea for my new truck, but the lease options are crappy now and payments were cheaper to buy outright.
bluebird1 Champion Author Toronto Posts:6,962 Points:1,423,425 Joined:May 2004	Message Posted: 7/28/2008 9:06:55 AM	Ignore bluebird1 Report Abuse
	If vehicle sales are stalling then doesn't that mean leasing as well. Big impact here is leasing firms will have many large vehicles depreciated much more than allowed for in the leases. You think you have problems selling off 1 gas guzzler...imagine having thousands.
niceguytx Champion Author Houston Posts:5,320 Points:1,031,570 Joined:Sep 2005	Message Posted: 7/28/2008 9:05:47 AM	Ignore niceguytx Report Abuse
	The cost of gas is leading people to travel less.
Chazzer Champion Author Nevada Posts:7,706 Points:1,655,910 Joined:May 2002	Message Posted: 7/28/2008 9:05:44 AM	Ignore Chazzer Report Abuse
	Yes, there is a plethora of cars for rent ... except in Las Vegas! They are all booked.
krell58 Champion Author Missouri Posts:4,068 Points:812,080 Joined:Apr 2006	Message Posted: 7/28/2008 9:05:24 AM	Ignore krell58 Report Abuse
	Watch the Energy Non Crisis. http://tinyurl.com/33l95c
AC-302 Champion Author Los Angeles Posts:7,471 Points:1,241,180 Joined:Aug 2004	Message Posted: 7/28/2008 9:04:34 AM	Ignore AC-302 Report Abuse
	Saw this last week in the paper and on the news. Someone is going to fill this market need. Just not CFC, FMC and GMAC. There's a definite market need for businesses to lease cars. Someone will provide it.
SummitSkiBum Sophomore Author Denver Posts:246 Points:100,740 Joined:Sep 2006	Message Posted: 7/28/2008 9:04:12 AM	Ignore SummitSkiBum Report Abuse
	The more gas costs, the less everyone has to spend on anything and everything else. It's not just leasing companies, its EVERYONE!! The SPECULATORS are robbing EVERYONE BLIND!! Including businesses that rely on money from people that are spending ALL of their EXTRA money on higher gas prices.
acknot All-Star Author Seattle Posts:547 Points:575,900 Joined:Sep 2003	Message Posted: 7/28/2008 9:03:55 AM	Ignore acknot Report Abuse
	Every business.
z1000 All-Star Author Indianapolis Posts:794 Points:137,380 Joined:May 2007	Message Posted: 7/28/2008 9:02:59 AM	Ignore z1000 Report Abuse
	Leasing is Fleecing
kissel Sophomore Author Pennsylvania Posts:146 Points:74,355 Joined:Sep 2005	Message Posted: 7/28/2008 9:02:27 AM	Ignore kissel Report Abuse
	I've never leased a car - I put too many miles on to even consider it.
RLH68 Champion Author Orlando Posts:1,606 Points:336,500 Joined:Jun 2007	Message Posted: 7/28/2008 9:01:21 AM	Ignore RLH68 Report Abuse
	Never could see the benefits of leasing.
cresovia Rookie Author Tallahassee Posts:67 Points:92,405 Joined:Apr 2008	Message Posted: 7/28/2008 9:00:16 AM	Ignore cresovia Report Abuse
	Stop leasing expensive cars???
amearly Champion Author Michigan Posts:3,615 Points:788,115 Joined:Jan 2006	Message Posted: 7/28/2008 8:58:11 AM	Ignore amearly Report Abuse
	Welcome to the real world.
Ty55 Rookie Author Wyoming Posts:25 Points:25,185 Joined:Jun 2008	Message Posted: 7/28/2008 8:47:39 AM	Ignore Ty55 Report Abuse
	My lease is working for me right now, but I am definately planning to buy outright with the next car.
cableman31 Veteran Author New York Posts:391 Points:354,715 Joined:May 2004	Message Posted: 7/28/2008 8:44:32 AM	Ignore cableman31 Report Abuse
	Leasing is not in the best interests of most people.
mplato All-Star Author Columbia Posts:984 Points:362,970 Joined:Jun 2004	Message Posted: 7/28/2008 8:43:49 AM	Ignore mplato Report Abuse
	stalling on old news
rodmiser Champion Author Missouri Posts:2,260 Points:845,270 Joined:Aug 2005	Message Posted: 7/28/2008 8:41:47 AM	Ignore rodmiser Report Abuse
	late
CruisinLinda Champion Author Tallahassee Posts:4,238 Points:863,385 Joined:Sep 2005	Message Posted: 7/28/2008 8:41:13 AM	Ignore CruisinLinda Report Abuse
	Car leasers can make a profit if they lease cars which will sell after the lease. Gas-guzzlers are not in demand any more. Leasing a car doesn't make much sense for the driver, even for one who wants to drive late-model cars. You can buy a car with a low down payment and sell it three years later. [Edited by: CruisinLinda at 7/28/2008 9:41:57 AM EST]