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Finance & Insurance Newsletter

Leasing rebounds, accounts for 1 in 5 sales

LAS VEGAS -- Leasing's share of U.S. retail sales rose by a point last year to 20 percent, according to the Manheim 2012 Used Car Market Report.

The report credits the industry for getting leasing right, at least "for the most part," by targeting lease consumers with good credit who trade their vehicles on a regular cycle. The industry also got praise for projecting end-of-lease residual values that were not overly inflated.

Despite what it calls an industrywide "conservative approach" to leasing, Manheim said leases rose 17 percent to 2.1 million units in 2011. That was 85 percent higher than the 1.14 million leases written in 2009, when large banks and finance companies had virtually abandoned leasing in the midst of the downturn. The figures exclude sales and leases to fleets.

The report, released Saturday at the National Automobile Dealers Association convention here, also notes that because fewer vehicles were leased during the recession, off-lease volumes will continue to decline this year. That decline is expected to contribute to tight supplies of fairly new, low-mileage used vehicles, which in turn should bolster used-vehicle prices.