Archive for the ‘Leasing’ Category

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…)

New Vehicle Sales Expected to Hit 17M-Unit Pace in September

Despite brisk pace, total will fall short over August numbers.

by on Sep.27, 2018

Despite a strong daily sales rate, U.S. new vehicle sales in September will fall short of August's results.

The total number of vehicles sold in September is likely to drop, according estimates from Edmunds and Cox Automotive.

Total sales volume in September, even though running ahead of August’s pace, is forecast to decline nearly 60,000 units from last month and nearly 100,000 units compared to September 2017, Cox said.

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“Year-over-year comparisons are challenging this September, as the industry saw record sales levels last year,” noted Charlie Chesbrough, senior economist at Cox Automotive. (more…)

Fade of Zero-Percent Financing Makes Leasing More Appealing

Rising interest rates pushing buyers toward leases.

by on Sep.14, 2018

Zero-percent financing deals are increasingly difficult to find these days, pushing some into leasing.

Car shoppers are always looking for a deal, and often they’re excited by the prospect of zero percent financing; however, those deals are getting tougher and tougher to find.

The percentage of sales with zero percent finance deals has been cut in half in the last two years — dropping from 14.6% of transactions in August of 2016, to 10.4% last August to just 7.4% this August, according to Edmunds.

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This drop during the last three Augusts sparks interest because zero percent financing deals usually abound in August and September.

“August truly represents the month that we would have expected to see a turnaround in this trend if one was imminent,” said Jeremy Acevedo, Edmunds’ manager of industry analysis. “Moving forward, shoppers will likely need to do a bit more digging to find other ways to save on a new vehicle because it looks like zero percent finance deals are going the way of the dodo.”

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New Vehicles Sales Fell in Q2, as Leasing Rates Rose

Mercedes-Benz boasts highest average lease price.

by on Aug.17, 2018

Leasing rates rose in the second quarter of 2018 with SUVs accounting for the largest portion of those leases.

Though auto sales were down overall in the second quarter of 2018, folks leasing instead of buying new vehicles were doing their level best to keep sales numbers high despite lower incentives, according to a new study.

Swapalease.com notes the average months remaining in leases rose during the second quarter to 28.8 months compared with 25.1 months in the first quarter. The rise is an indication that people were looking to get out of their leases early in search of a better vehicle or deal.

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Not only was that measure up, the average miles remaining fell from 23,115 to 22,617 left in their contract, which is only a slight decrease. The ratio of months remaining to miles remaining, according to the website, is an indicator that people are driving more. Those looking to get out leases early could have been creeping up on their contract limit, forcing them to make a move earlier. (more…)

Lease Prices Remain Flat for Summer — Mostly

Good deals are target of potential leasees.

by on Jun.25, 2018

Lease approvals are on the rise in the U.S. as leases search for good deals.

More Americans are getting approved for leases, lured by some aggressive pricing by automakers; however, prices for most leases remain stable heading into the summer selling season.

The lease approval rate hit its highest number in 2018 at 70% last month, jumping from 67.3% in April, and well above the 57.8% at the start of the year. The approval rate was up in February and March, according to Swapalease.com.

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“Lease credit approvals continue to show more stability as we move through spring and into the summer months,” said Scot Hall, Executive Vice President of Swapalease.com.  (more…)

Automotive Subprime Lending Down in Q1

Banks, finance companies cut back 9.5% in first quarter.

by on May.08, 2018

Banks and finance companies are tightening their belts when it comes to lending to subprime buyers.

With predictions about new vehicle sales for 2018 hovering at or just below 17 million units, it appears that banks and finance companies may be inadvertently impacting that sales total with their current lending practices.

According to Equifax, subprime lending is down nearly double digits through the first quarter of the year.

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Reports show that 386,500 auto loans and leases have been originated YTD to consumers with a credit score below 620, which is generally considered subprime. This is a 9.5% decrease from the year-ago period.  (more…)

Caddy Triggers Battle of the Behemoths with $10,000 Escalade Discounts

Fighting off the new Lincoln Navigator.

by on Apr.16, 2018

A Cadillac Escalade Platinum can top $100,000.

If you’re looking for one of the biggest, baddest luxury utes on the market, Cadillac is hoping to lure you into one of its U.S. showrooms. Aiming to shore itself up against an assault by Lincoln’s newly updated Navigator SUV, Caddy is firing back with discounts of up to $10,000 on its own Escalade model.

GM has traditionally dominated the full-size SUV segment, both mainstream and luxury, and it gained significant traction when it introduced an all-new version of the ‘Slade for the 2014 model-year. But that’s a lifetime ago in today’s hotly competitive market and Lincoln has been building momentum fast with the all-new version of the Navigator it launched last year.

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While the two models don’t generate a lot of volume they serve up substantial profits for their respective manufacturers, providing plenty of room to load up the incentives. The question is whether Lincoln will now fire back with big givebacks of its own.

(more…)