Vehicle leasing popularity grew for the fifth straight year according to recently posted 2007 new vehicle industry data, Swapalease.com reports.
Lower lease payments will be the likely result of several key market factors. First, growth in the lease segment will create additional competition, meaning lessors will need to work hard to win potential lessees from rivals. Second, the duration of traditional automotive loans for new vehicles approached five and a half years in 2007 making that option less attractive to many consumers when compared to significantly shorter lease commitments. Third, interest rates continue to trend lower reducing the money factors used to calculate leases.
Leasing has historically been more prevalent among luxury nameplates as opposed to those with a broader appeal and price point. It appears that this trend will remain consistent for the time being with growth present in both segments.
According to Swapalease.com, dealers—regardless of make—embrace leasing because of the shorter client cycle and consistent efforts by manufacturers on their behalves to retain customers. Many automotive marketing experts predict that new vehicle lease penetration will see a sixth straight year of growth in 2008.
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