Many of the people that I speak with about leasing a vehicle immediately get defensive because they have heard the horror stories of people who lease the wrong vehicles. However, what most people don’t realize is how leasing the right vehicle can be a huge benefit to the consumer.

For example, look at what’s happening with Ford’s Jaguar division currently. In a recent issue of Automotive News, it was reported that Jaguar Cars of North America had to remarket 20,000 vehicles and in 2005 that number soared to 27,000. These were mostly X-Types and S-Types coming off of leases. That huge number of used cars was 89 percent of Jaguar’s total new vehicle sales in 2005.

The article went on to say that this year, Jaguar will still have to remarket about 21,000 units that are expected to be returned and Jaguar’s executive vice president of marketing is viewing that figure as “a walk in the park” compared to the previous year. In fact, Jaguar has elected to stop selling cars to Enteprise and Hertz because their aggressive lease program has hurt them so bad.

In 2001 the residual value on an X-Type was 49% and in 2006 it’s still somewhat aggressive at 40%. The people who leased a Jaguar over the last few years really made out on the deal. Think about it for a minute. These people were able to drive a new and very elegant, high-end automobile for three ears with a full warranty and have Jaguar subsidize their lease payment.

At the end of the lease they walked away without having to worry about finding a buyer or getting less money by trading in their vehicle. Now Jaguar is the one that has had to scramble to sell all of these vehicles, while the savvy consumers have dropped the keys and given the vehicles back to Jaguar knowing they are not worth what Jaguar said they would be.

This is the part of leasing that most people end up missing out on. If you lease the right vehicle, drive the right amount of miles and get the right residual values and lease terms; you can really capitalize on the incentives that manufacturers offer.

Why not let the automobile manufacturers that are willing to take a huge risk to move their inventory, give you the opportunity to drive one of their new vehicles at a substantial discount and give it back to them at the end of the lease term, letting them worry about finding another buyer?

It can make tremendous sense when done correctly as is illustrated in the “Jaguar battles used-car glut” article that was featured in the industry insider magazine Automotive News.

Contact me if you would like me to help you find a pre-owned Jag or if you would like to find out which manufacturers are running outrageous lease incentives you could take advantage of today.
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Auto Consultant – John Boyd: The Cool Car Guy

John is an auto consultant with his license at a car dealership in Denver, Colorado. He can help you save time and money on any make or model, new or used, lease or purchase – nationwide! Call or email John about your next vehicle! jboyd@coolcarguy.com or Twitter @coolcarguy