Share of new U.S. vehicles on lease 2017-2019
In the fourth quarter of 2019, almost 30 percent of vehicles leased in the United States were new vehicles, with the others being sold outright.
Why lease a vehicle?
Depreciation is the largest portion of the average annual cost of vehicle ownership. When leasing a vehicle, this cost is absorbed by the leaser, rather than the consumer. Similarly, maintenance costs are often paid by the company leasing the car, in order to keep the car in good condition for eventual sale after the lease ends. Finally, with the interest rates on auto loans approaching five percent on average for a 60-month loan, financing a car purchase can add a significant amount to the sticker price.
The auto market in the United States
Vehicle sales in the United States amount to millions of cars per year. Through leasing new cars, drivers have the opportunity to enjoy a new vehicle without worrying about the longer term issues of car ownership. For suppliers, the cars retain a significant portion of their original value. After the lease, suppliers can then sell them in the automotive aftermarket.
Why lease a vehicle?
Depreciation is the largest portion of the average annual cost of vehicle ownership. When leasing a vehicle, this cost is absorbed by the leaser, rather than the consumer. Similarly, maintenance costs are often paid by the company leasing the car, in order to keep the car in good condition for eventual sale after the lease ends. Finally, with the interest rates on auto loans approaching five percent on average for a 60-month loan, financing a car purchase can add a significant amount to the sticker price.
The auto market in the United States
Vehicle sales in the United States amount to millions of cars per year. Through leasing new cars, drivers have the opportunity to enjoy a new vehicle without worrying about the longer term issues of car ownership. For suppliers, the cars retain a significant portion of their original value. After the lease, suppliers can then sell them in the automotive aftermarket.
