ATLANTA - Skeptics be damned. GE Capital Auto Financial Services sees a big future for itself in a nontraditional area of the used-car money business: used-car leasing.
Sandra Derickson, president of GE Capital Auto Fi-nancial Services, told the June 3 Society of Automo-tive Analysts conference she believes used-car leasing today is where new-car leasing was in the early 1980s. GE Capital estimates used-car leasing now accounts for about 2 percent of all used-car volume, about the same as new-car leasing almost two decades ago.
Said Derickson: 'We were pioneers in new-car leasing, and we plan to be pioneers in the future, with a focus on used-car leasing and subprime finance.'
Derickson said used-car leasing will account for more than half of GE Capital's auto lease contracts in 1998. GE Capital had a lease portfolio of $13.4 billion in 1997.
'We're shifting so much,' she said. 'The used piece is growing so fast.'
Derickson said used-car leasing has not achieved the success it might have so far because lenders did not recognize the variance in credit profiles.
Art Spinella, general manager of CNW Marketing/ Research, said, 'The problem with used-car leasing isn't that it won't grow or couldn't grow or shouldn't grow. The problem is so few consumers even know it exists.'