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More Off-Lease Vehicles Head to the Used Market


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Washington DC March 2, 2009; The AIADA newsletter reported that about 2.6 million cars and trucks are projected to come off lease and enter the used-vehicle market this year — 8.3 percent more than in 2008.

But instead of glutting the market, the boost in off-lease vehicles will be offset by decreases in the number of used vehicles retired from rental service or traded in by consumers for new vehicles, analysts predict.

Automotive News reports that current wholesale values of many off-lease vehicles — especially SUVs — are much lower than residual-value projections made three years ago, when the leased vehicles were new. Still, Tom Webb, Manheim's chief economist, says he expects overall used-vehicle prices in 2009 to be largely unchanged from last year. Manheim is the nation's largest auto auction company.

The additional off-lease cars and trucks "won't have much of an impact on prices because overall volume will be less," Webb said.

James Clark, editorial director of Automotive Lease Guide, predicts that resale conditions will remain tough for auto remarketers this year. He says: "We have a lot of used vehicles coming back into the market relative to what the size of the industry is today."