Rental car companies bought one of every eight new vehicles sold in the United States last year.
Manheim's 2006 Used Car Market Report says rental companies bought almost 2.1 million new cars and trucks in 2005 - more than 12 percent of all sales. Sales to rental companies rose by 7 percent last year over 2004, Manheim says.
The Atlanta auction company released its report at the convention Saturday.
Vehicles built by General Motors, Ford Motor Co. and the Chrysler group dominate rental car fleets. Those companies' cars and trucks made up 81 percent of rental fleet volume in 2005. That was down from 85 percent in 2004, the Manheim report says.
"Rental fleets account for a high percentage of sales for models such as the Ford Taurus and Chevrolet Impala," the report adds.
But domestic automakers are curbing their reliance on rental car sales, the Manheim report says.
Sales of program cars - vehicles sold to rental companies and then bought back by the manufacturers - dropped by 114,000 units in the 2005 model year, to 1,006,000.
The number of off-lease vehicles that returned to the market in 2005 fell by more than 1 million units from 2003, the report says. Last year, 2.45 million vehicles came off lease.
Manheim says it expects off-lease volume to decline again this year, to 2.35 million vehicles. But volume will start to grow in 2007, the report predicts.
The decline reflects the decrease in the number of new vehicles leased earlier in this decade. But the report says new-vehicle leasing has grown since it bottomed out at just under 2.0 million vehicles in 2003. Leasing grew to 2.1 million vehicles in 2004 and 2.4 million vehicles last year, Manheim says.
Manheim notes that New York and several other states passed laws last year that limit car companies' exposure to vicarious liability.
State vicarious liability laws hold automakers responsible for crashes and damages to leased vehicles because their names appear on the vehicles' titles.
Improving residual values "should add further impetus to leasing's growth," the report says. A residual value is a prediction of what a new vehicle will be worth at the end of its lease, generally 36 months.
Lease customers and dealers bought 49 percent of vehicles whose leases ended last year, Manheim says. That compares with 41 percent in 2003 and 47 percent in 2004.
Other report findings for 2005:
- More than 23 million used vehicles were wholesaled. Of those, 9.59 million were sold at auction.
- Wholesale prices of used vehicles rose 4.6 percent.
- Commercial and government fleets bought more than 959,000 new vehicles.
- About 1.34 million vehicles were repossessed.
You may e-mail Arlena Sawyers at [email protected]