Executive Automotive Analyst
NADA Used Car Guide
Lease penetration has grown substantially – from 25.7% in 2014 and up nearly 2 percentage points more so far this year to 27.8%, on pace to top 1997’s all-time high of 27.4%. A drastically reduced supply of used vehicles from strong demand and a drop in sales during the recession helped boost used vehicle prices. There’s been a wide gap in retained value over that time – in 2007, averaged retained value for 3-year-old units, typically off-lease vehicles, stood at approximately 45% of equipped new vehicle prices. In 2014, 3-year-old retention hit 54.4%.
Number of New Retail Leases Originating in 2010 Reached 1.75M Units:
Hit 3.48M in 2014, doubling four years earlier and surpassing previous high in 1999.
J.D. Power Estimates Off-Lease Will Grow by 4% to a Total of 2.3M Units:
Off-lease volume this year will pale in comparison to 2015 with 800K units maturing.
Expanding Used Supply Spearheaded by Off-Lease will Compress UC Prices:
Effect will be most pronounced on subcompact and compact cars, and by both non-luxury and luxury compact and midsize utilities.