December 30, 2002

Leasing down dramatically in the United States

Nashville, Tennessee - New lease volume for the period January to November, 2002 for the largest national lessors declined 14.5% from the same period in 2001 according to a survey conducted by The Association of Consumer Vehicle Lessors (ACVL). A prior ACVL survey of the full year volume change from 2000 to 2001 found a 40% drop. When combined, these surveys indicate that there has been about a 50% drop in lease volume since 2000!

The results showed member lessors purchased 2.07 million leases for the same 2001 period compared to 1.78 million YTD in 2002.

Although the overall 2001/2002 decline was 14.5%, the average respondent's volume declined somewhat less, 10.5%. This would indicate that, on average, larger lessors had greater declines than smaller ones. Not all respondents had reduced volume: 29% of member lessors experienced an increase in volume averaging 25.6%.

Bank lessors saw their volume decline 19%, compared to 14% for manufacturer captive finance companies. "There were a number of factors contributing to lower lease volumes," explained Rob Mize, ACVL President, "including the 0% manufacturer promotional loan finance rates and other very low interest rates, lower residual values (causing higher monthly payments), fewer manufacturer lease promotions, and the retraction of some bank lessor programs by withdrawing from some states and/or being more selective in approving lease applications."

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