Millions of Leases End This Year
There will likely be just a shade under 3 million lease terminations in 2014, according to Edmunds.com, whose data indicates this would be a four-year high.
Or, put a different way, “Car shoppers coming off lease will account for some additional 300,000 in new car sales over 2013, or about 40 percent of the expected 2014 auto sales growth,” Edmunds chief economist Lacey Plache said in a recent analysis posted to the company’s website.
Elsewhere, Manheim is projecting off-lease volumes of just over 2 million vehicles for 2014, continuing what has been a steady rise since 2012 — with more growth to follow.
“Since new lease originations grew by a million vehicles between 2009 and 2011, and then by another million units between 2011 and 2013, we can be assured of a similar rise in off-lease volumes in the coming years,” Manheim said in its 2014 Used Car Market Report.
“And since the increases in lease penetration rates were not consistent across manufacturers, neither will be the changes in off-lease volumes,” Manheim’s report continues. “Note, for example, that although total lease originations in 2013 are nearly three times higher than in 2009, new lease volumes have grown by a factor of 10 or more at GM, Chrysler, and Hyundai/Kia.”
Over at NADA Used Car Guide, although it believes overall supply of used vehicles up to 8 years old available for dealers will be essentially static from 2013, analysts there are eyeing approximately an 18-percent year-over-year increase in off-lease volume, following what was about a 14-percent rise in 2013.
For more insight into how the off-lease surge may impact remarketing, see our story here.