Car Leases Down

Many people think about the economy and they think about the hundreds of thousands of foreclosures out there today. However, they also think about all of the car loans that have been forfeited and how cars are being repossessed right, left and center. However, in all of this talk of auto loans, quite often people do not realize that the lease industry is taking a beating as well.

The problem is that there are few people able to afford a car lease right now, as they are simply – in most cases – throwing their money away. They don’t have the ability to pay for a car, or to take out a car loan, so they definitely aren’t going to put money down on a car that they will have to surrender if they don’t decide to buy it.

Auto leases are considered a luxury right now, just like many other things are. Car loans are also considered a luxury but less so than leases. Many leases are subsidized by manufacturers and many of those large car companies are pulling out of the business. They are putting their “eggs” if you will into the car loan business because they know they stand a better chance at gaining something from it.

The big three car makers have announced that they are leaving the auto lease industry to work on their auto loans because the cost of borrowing for these giants has gotten just too high. Not only that but many cars coming off of leases are just not worth what they used to be.


 

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