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| Saturday, July 26, 2008 |
| If thinking of leasing, don't wait too long |
The New York Times article: Plummeting Resale Values Lead Chrysler to End Leases was interesting to me, since I know two people who recently leased a minivan and an SUV instead of purchasing - both needed the large vehicles due to number of family members and recreational needs (boaters tend to have to haul trailers) - but both did not want to outright purchase a big vehicle because they were depreciating so rapidly. Looks like they are not the only ones who realized leasing was becoming a better deal for the consumer than the auto makers: The company, now privately held, told its dealers on Friday that its financing arm, Chrysler Financial, would stop offering leases as of Aug. 1, a move that comes as plummeting resale values of gas-thirsty trucks and sport utility vehicles turn lease deals on those vehicles into big money losers for the Detroit automakers.
On Thursday, the Ford Motor Company took a $2.1 billion write-down in the second quarter, part of an $8.7 billion loss for Ford over all, related to unprofitable leases held by its finance arm, the Ford Motor Credit Company.
James E. Press, a co-president of Chrysler, said the carmaker would divert money it had been spending to subsidize leases toward offers that make traditional financing more affordable. He said Chrysler would offer discounts so that many customers who financed a vehicle would end up with about the same monthly payment that they would have had in a lease. |
| posted by Boston Gal @ 9:10 AM *
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I've been thinking of unloading my minivan for a more fuel efficient car before the minivan doesn't have any residual value. This blogger had an interesting take on it.
http://blog.greenwichfinancial.com/2008/07/chrysler-stops-leasing-implications-for.html
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I've been thinking of unloading my minivan for a more fuel efficient car before the minivan doesn't have any residual value. This blogger had an interesting take on it.
http://blog.greenwichfinancial.com/2008/07/chrysler-stops-leasing-implications-for.html