We are never going to Lease Vehicles again so said the big Auto Makers just a few years ago.

Remember just a few short years ago all the car dealers and manufactures said they were finished with leasing as they were loosing tons of money? Well I do and what got my brain a ticking was all the adds in the paper the past few months and not one of them shows the actual cost of purchasing the vehicle but just the lease price.

wardsauto.com...

“Leasing is not right for every family in America,” says John Hyatt, president of Bank of America’s Dealer Financial Services. “Historically, it was used as a tool to get people in a car they probably couldn’t otherwise afford. That wasn’t a good idea back then.” Nor is it a good idea now, Gilman says. “We are starting to see things that were done before, and I’m worried about it.”

Chrysler and General Motors, in particular, lost their shirts on the bad bet of sub-venting lease deals for overproduced vehicles that carried poor residuals because of the glut. Unable to sustain that no-win situation, cash-strapped Chrysler and GM pulled out of leasing in 2008, a prelude to both entering bankruptcy. “It was tough,” says Thomas Gilman, who headed the defunct Chrysler Financial at the time and now is president and CEO of TD Auto Finance. “When you liquidate a leasing portfolio, you learn a lot.”

So now I wonder who is going to benefit from this resurgence in Leasing instead of just buying and owning the vehicle?
I remember during the big crash years ago all the automakers took a big hit and I figure that they are back to the trough for seconds.
I'm sure leased cars have their place in life but for the love of god why not wait till you can afford to purchase your own ride?

Some folks never learn and I am aiming that one at the car makers and bankers.

Regards, Iwinder

originally posted by: Iwinder
I'm sure leased cars have their place in life but for the love of god why not wait till you can afford to purchase your own ride?

I can certainly afford to purchase my car but I would prefer to lease it for three years and then be done with it so I can get a newer vehicle. I do not want to deal with continuing depreciation and maintenance and find this to be the best course of action.

originally posted by: AugustusMasonicus

originally posted by: Iwinder
I'm sure leased cars have their place in life but for the love of god why not wait till you can afford to purchase your own ride?

I can certainly afford to purchase my car but I would prefer to lease it for three years and then be done with it so I can get a newer vehicle. I do not want to deal with continuing depreciation and maintenance and find this to be the best course of action.

Well I am pretty sure that most folks can't afford a perpetual life time payment just for a car. Secondly they are so well made now that after five years of payments (if you purchase) they are good for another 5 years and your not paying X amount of dollars for it.
But If your happy with your finances and your new "Ride" every three years I see no harm in that, I do see the auto makers making the same mistakes as they did previously years gone by and whom is going to bail them out again I ask?
The tax payer.
Regards, Iwinder

originally posted by: Iwinder

Well I am pretty sure that most folks can't afford a perpetual life time payment just for a car. Secondly they are so well made now that after five years of payments (if you purchase) they are good for another 5 years and your not paying X amount of dollars for it.

The price I pay for my leased vehicle is much cheaper than a five year finance option and I get free maintenance.

originally posted by: AugustusMasonicus

originally posted by: Iwinder

Well I am pretty sure that most folks can't afford a perpetual life time payment just for a car. Secondly they are so well made now that after five years of payments (if you purchase) they are good for another 5 years and your not paying X amount of dollars for it.

The price I pay for my leased vehicle is much cheaper than a five year finance option and I get free maintenance.

All right we got the chit chat out of the way now can you answer me this one? Why are they doing it again after going Bankrupt. You see that is the whole point of this Rant. They said never again will we Lease and here we are right back at square one with them leasing left and right.

Regards, Iwinder

originally posted by: Iwinder
All right we got the chit chat out of the way now can you answer me this one? Why are they doing it again after going Bankrupt. You see that is the whole point of this Rant. They said never again will we Lease and here we are right back at square one with them leasing left and right.

Regards, Iwinder

They should be allowed to go bankrupt and not bailed out as taxpayer money should not be used to remedy bad business decisions or play favorites.

originally posted by: AugustusMasonicus

originally posted by: Iwinder

Well I am pretty sure that most folks can't afford a perpetual life time payment just for a car. Secondly they are so well made now that after five years of payments (if you purchase) they are good for another 5 years and your not paying X amount of dollars for it.

The price I pay for my leased vehicle is much cheaper than a five year finance option and I get free maintenance.

Did the same thing myself. Turned out Mazda leveraged leases to rid themselves of lemons. Once you were on the hook, you couldn't drive the car because it spent all of its time in the shop, while I got to drive around their beater for loan.

Not falling for that again.

originally posted by: Snarl

Turned out Mazda leveraged leases to rid themselves of lemons.

I have not encountered that problem and the few instances where I required a loaner car I was given one of the same class I was leasing.

originally posted by: AugustusMasonicus

originally posted by: Snarl

Turned out Mazda leveraged leases to rid themselves of lemons.

I have not encountered that problem and the few instances where I required a loaner car I was given one of the same class I was leasing.

For me, that was almost twenty years ago. I'm still POd. LOL

You get burned, you don't forget. Did I mention that I don't wander onto Mazda car lots either?

originally posted by: Snarl

You get burned, you don't forget. Did I mention that I don't wander onto Mazda car lots either?

I could see how that would color my decisions. Other than one car I have been generally pleased with my leasing results.

For business owners, it makes sense to lease vehicles because they can write off the lease payments. A purchased vehicle only has the capital cost allowance (depreciation) as a write off.

But for everyday folks, it makes no sense to me, other than the fact that it's based on the personal taste of wanting to step into a brand new vehicle every 3 years.

Perpetual monthly payments and never actually owning anything isn't my cup of tea... but everybody has their own personal preferences on how they choose to utilize their in/out cashflows.

For the last five years, I've been keeping three cars on the road (minus gas, but including insurance and replacement cost...) for $200 a month.

200 a month, three cars. I've managed to cycle through/replace all three in that time period and still maintain budget. I live in a place where cars have a five year reasonable lifespan- because the magnesium chloride they spray on the ground eats them. We ship in older cars from other parts of the country that need a little mechanical work, and run them until they rot.

Most people around here do the newer car leasing thing- who the hell has 400 a month for a single car?

Leasing might as well be stealing from people who can't handle a little light labor. Buying a car and making payments on the loan is just as bad- if not worse.

a reply to: AugustusMasonicus

They should be allowed to go bankrupt and not bailed out as taxpayer money should not be used to remedy bad business decisions or play favorites.

Agreed my friend many thanks for posting that.
Regards, Iwinder

a reply to: Iwinder

The whole auto leasing thing was brought about with business owners in mind. It was a huge bonus to businesses to be able to increase their write offs to bring down their taxable income at the end of every fiscal year.

Particularly trucking companies, courier companies, taxi companies, etc... Any business that required a huge fleet of vehicles.

After a few years, the leasing idea trickled down to the common consumer and became available to them.

It was a massive bonus to car dealerships and any company that offered leasing options for vehicles. Now they were making money on the interest/user fees/etc from neverending lease payments, plus they increased the opportunity for return customers to lease another vehicle at the end of each lease contract, plus the added bonus of getting back the vehicle asset to resell to other consumers shopping for a used vehicle to purchase.

It was a win-win for these leasing companies.

Not so much for the consumers... other than enjoying that "new car smell" every 3 years.

What these leasers didn't anticipate, was the leasees driving the hell out of vehicles and at the end of the lease agreement, returning a vehicle that was abused in need of repairs and maintenance and oober high mileage... thus drastically reducing its resale market value.

a reply to: Iwinder

My 1994 Chevy S10 still runs and my 2001 Chevy Tracker ZR is doing just fine, though it is missing some of its decorative parts.

I dread the thought of the inevitable death of my Tracker. I have no desire, nor can I afford a car payment. I have gone so long without a car payment, it almost feels like a punishment to even think about having one again, but it will be a purchase under duress, there is no way I will ever lease.

All cars have a monthly cost when you break it down. I sometimes lease sometimes buy (leasing isn't as big in the UK). Personally I change my car every 2-3 years, they start to go wrong after that and get a bit scarppy looking IMO. I know guys who drive cars till they drop and sear by it. But really its not all about money, a 20 year old Audi is never going to be as nice to be in, drive or as economical as my brand new Volvo. I like having nice things and I like the peace of mind of knowing when I press the start button she will fire up.
Leasing is sweet because you just hand her back and get a new one, no trade in bollocks etc. I have noticed some manufacturers do seem to be geared for leasing (GM or Vauxhall as we call them). You can lease an Astra for less than you could buy a Corsa for which is quite odd.

Here in the UK leasings always been more of a business thing as it allows companies to fix their budgets as no matter what happens to the car you pay the same money every month and normally it comes with servicing/insurance thrown in so for the business all they need to do is check the petrol usage for claiming it back in the personal/business split for the tax man and job done and probably after 3 years it's hitting its first major service and MoT so its a good time to hand it back and pick up a new one

Many years ago we got offered a small business van (the ford tranny) for £100 a month for 3 years which made it cost £3600 over the life of it and that included insurance and road tax/servicing etc..buying a van i'd of lost more than that just driving it off the forecourt but we sold the business due to illness so never did take them up and i think the 100 quid a month was able to be reclaimed to a certain point making it even cheaper

originally posted by: NightSkyeB4Dawn
a reply to: Iwinder

My 1994 Chevy S10 still runs and my 2001 Chevy Tracker ZR is doing just fine, though it is missing some of its decorative parts.

I dread the thought of the inevitable death of my Tracker. I have no desire, nor can I afford a car payment. I have gone so long without a car payment, it almost feels like a punishment to even think about having one again, but it will be a purchase under duress, there is no way I will ever lease.

Yep we both the wife and I keep vehicles till they die or become too expensive to repair. Change the oil and do basic maintenance and you should be good for a long time ......sans the payments. Mind you I can understand how some folks want a new car all the time the newest and the latest seems to be the mantra.
Years ago while we worked hard to pay down our mortgage our two vehicles were free and clear from any debt. Hell no they were not pretty or nice to ride in but we did in fact pay off our home 14 years early whilst we drove crappy vehicles all the while.

It seemed to work out all right, now those pesky Mortgage payments of $850.00 or so a month have been going into our savings for the past decade and a half.

My wife's car is a 2003 model and our truck is a 2008 and they both still run great with no major problems at all. (Knock on wood) and both are free and clear from any payments.

Regards, Iwinder

a reply to: CranialSponge

But for everyday folks, it makes no sense to me, other than the fact that it's based on the personal taste of wanting to step into a brand new vehicle every 3 years. Perpetual monthly payments and never actually owning anything isn't my cup of tea... but everybody has their own personal preferences on how they choose to utilize their in/out cashflows.

“I’d rather see people lease than buy,” says William Underriner, a Montana dealer and the 2012 NADA chairman. “At the end of a 24- or 36-month lease, the customer is back at the dealership deciding what to do next.”

Nor ours either, I guess the auto makers are too big to fail now with government backing whenever they screw up:-)
Regards, Iwinder

a reply to: Iwinder

I never understood leasing a vehicle myself. Who the hell would want to pay a monthly payment yet never own the vehicle? Those people are idiots, plain and simple. Wheres the pay off!? There is none!