Archive for the ‘Leasing’ Category

Poor February Auto Sales Confound Analysts

Industry to see run on new leases in next few months.

by on Mar.07, 2019

Winter weather and rising prices kept sales down in February, surprising some analysts.

After of drop sales in February of 2.8%, the auto industry is facing unsettled times during the next few months, analysts predict.

“February had a lot of good economic news to support a healthy vehicle market outlook, but that may not be coming to pass. The stock market has had a tremendous ride since the start of the year and consumer confidence, which took a tumble in January, has regained much of its decline,” observed Charlie Chesbrough, Cox Automotive senior economist.

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“With January’s government shutdown and record-breaking sub-zero temperatures in the rearview mirror, we expected a general upward lift in February,” he said. (more…)

Tesla Boss Musk Teases Big Announcement

What's coming later today? Nobody really knows.

by on Feb.28, 2019

Tesla CEO Elon Musk plans to reveal something new at 2 p.m. Pacific Time today.

Elon Musk is creating more news. Fortunately, this time it won’t – or shouldn’t – involve the U.S. justice system.

Musk changed his name on Twitter to Elon Tusk and announced the company would be making an announcement at 2 p.m. Pacific Time today. He didn’t provide any other details, and has since changed his name back to Elon Musk.

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Naturally this sent followers, analysts and industry observers a buzz with anticipation. One analyst, Adam Jonas of Morgan Stanley decided to take a stab at what he thinks is coming later today on the webcast. (more…)

Tesla Readying to Lease Model 3s to Employees

EV Maker's general counsel departs.

by on Feb.20, 2019

Tesla is readying to offer leases on its new Model 3 to employees to help boost demand for the sedan.

Tesla Inc. is readying for the next step in the evolution of its Model 3: leasing.

According to Electrek, the Palo Alto, California-based EV maker is looking to boost demand for the new mainstream sedan by offering employees a leasing program for the vehicle. Initial reports suggested the program would be in place in as little as two weeks.

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The leasing availability was outlined in an email to employees. However, the company denied it will be ready that quickly, although did confirm it was coming. (more…)

Auto Loan Delinquency Rate Higher than Great Recession

Young buyers finding it tough to make car and student loan payments.

by on Feb.13, 2019

Auto loan delinquencies are on the rise, and are higher than during the Great Recession.

The Federal Reserve Bank of New York reports that more than 7 million Americans are delinquent on auto loans, even more than during the Great Recession.

The figures, which were part of New York Fed’s quarterly report on household credit, suggest that many consumers are having a difficult paying their bills. Rising prices for both new and used vehicles also are factor, economists said.

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“Although rising overall delinquency rates remain below 2010 peak levels, there were over 7 million Americans with auto loans that were 90 or more days delinquent at the end of 2018. That is more than a million more troubled borrowers than there had been at the end of 2010 when the overall delinquency rates were at their worst since auto loans are now more prevalent.  (more…)

Rising Interest Rates Will Drive Auto Sales Down in 2019

Edmunds predicts rates will continue upward.

by on Jan.03, 2019

Rising interest rates and falling incentives are expected to combine to drive down new vehicle sales in 2019.

The Federal Reserve raised interest rates throughout 2018 and, as observers expect to confirm today, new vehicle sales rose year-over-year. However, experts predict that will be a one-time occurrence.

There was a dip in automotive interest rates at the end of the year to help with holiday sales. New vehicle rates averaged 5.9% in December, according to Edmunds.com, after averaging 6% in November, which helped drive a strong end to the year.

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However, that average was largely driven by banks and other lenders rewarding buyers with excellent credit special low-interest loans rather than an overall shift downward. (more…)

Tesla Sets Up Leasing Company in China, Adds Two New Directors

Company as Oracle founder Ellison to board of directors.

by on Dec.28, 2018

Tesla Inc. established a leasing operation in China: another step toward growing sales in China.

Tesla Inc. is growing internationally while simultaneously resolving its battle with federal regulators in the United States.

The California-based electric-vehicle maker registered a wholly owned financial leasing company in China, with registered capital of $30 million, according to China’s National Enterprise Information Publicity System.

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The move to open a leasing operation in China falls in line with its plans to begin selling and building its cars in China. The company is seeking contractors to build its $2 billion gigafactory near Shanghai. The company has been moving quickly to establish a hold in China since the government eased local ownership laws for foreign EV makers. (more…)

Used Vehicle Prices Rising, Pushing Buyers to Look at Leasing

Rising interest rates hastening trend.

by on Nov.09, 2018

Used car shoppers are finding higher prices than ever for vehicles.

New vehicle prices have reached all-time highs this year and now used vehicles, the haven for car buyers looking for a deal, have now joined new cars, setting a new pricing benchmark.

The average price of a used vehicle is now $20,084, the highest since 2005 and a 3.5% increase year over year, Edmunds notes, adding that increase is rising as it jumped to 5% in Q3. American preferences for expensive new trucks and utility vehicles pushed new vehicle prices over the $36,000 mark, according to Cox Automotive.

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In short, buyers are paying more for a vehicle and with interest rates rising, the options for cutting down that monthly payment are getting tougher. (more…)

Cadillac Suspends Subscription Plan

No word on what will replace Book by Cadillac.

by on Nov.05, 2018

Book by Cadillac, the brand's new subscription service, has been suspended until next year.

General Motors’ Cadillac division is hitting pause on its vehicle subscription service, Book by Cadillac, then it will be relaunched early next year.

Andrew Lipman, a Cadillac spokesman, confirmed the plans, following a Wall Street Journal report that Cadillac was planning kill the program.

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“Book by Cadillac is not canceled,” Lipman said. “We are stopping it for a short period of time to then relaunch it based off the learning we have made in early Q1. We are hitting the pause button and we will be back.” Lipman told Automotive News. Part of the problem Cadillac’s subscription program was that at $1,800 per month it was too pricey. (more…)

New Vehicle Prices Continue to Rise in Fourth Quarter

More content, higher interest rates driving increase.

by on Nov.01, 2018

Ford's new SUV sales are on the rise, as is its average transaction price by $1,400 per vehicle.

Despite predictions of an overall decline, U.S. auto sales rose slightly in October, led by companies with shiny new sport-utilities and crossovers to offer buyers.

However, those more desirable vehicles combined with rising interest rates are resulting in new vehicle prices that are on the rise. This is likely, at least according to one automaker, put a dent in sales for the remainder of the year.

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During its sales call, executives at Ford Motor Co. warned sales numbers will continue to fall in 2018, in part because of the rising interest rates pushing up prices. (more…)

GM Offers First-Ever Extended Bumper-to-Bumper Warranty

Company claims it could raise resale values.

by on Oct.15, 2018

GM's new extended warranty is accepted at all GM dealers across the U.S.

The difference between buying one new vehicle or another can often come down to the tiniest of things, but General Motors is now offering a big thing that it hopes will make a big difference: an extended bumper-to-bumper warranty.

The company is offering what it is calling the first ever true extended bumper-to-bumper warranty that covers Chevrolet and GMC products for five years or 60,000 miles, whichever comes first, while Cadillac and Buick owners can get a six-year or 75,000-mile warranty.

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“One of the best things about buying a new vehicle is the peace of mind that comes with the warranty,” said Ken Mac, director of Chevrolet, Buick, GMC, Cadillac Protection.  (more…)