Interesting AP article (link below from my local area paper) that talks about the effect leasing has had on the new and used car selling business. There are a number of references to Infiniti and specifically the Q50 throughout the article.
Interesting article.
At least where I live, it was that way with G37's as well.
You could get a lease 2 or 3 year lease return at a good price.
One thing infiniti has done over time is adjust the q50 residuals since they came out in 2013 (2014).
They are much lower now, so infiniti has baked more costs into the leases.
But how is this any different than previous generations or competitor lease returns like the 3 series and similar models? Its the same cycle every 3 years, and in the end all those used cars find a buyer one way or another.
As an industry, we've been leasing way more vehicles (as a percentage of sales) the past few years. My guess is we're at 60+% on new vehicles where I work. Also, dealerships have a quota for CPO sales that they need to meet for the manufacturer. As a result, there are lots of great young used, lease-return cars and sometimes dealers will sell them at a loss or at wholesale just to make their volume numbers. I've seen us do it sometimes.
For example, if anyone wants a 1 year old QX50 right now, I can make them an insane deal (we have 9 of them in stock). The QX50's were all service-loaner cars for a year, and come with nearly 5 more years warranty (longer than the original). The cars are an insanely good deal, but there is still a limited audience for a $30K used car.
Big difference is that Infiniti was always the "lease winner", which is a big deciding factor for many shoppers (myself included). It makes sense as a company that Infiniti would lower residuals, especially on the 2.0t models. My brother is in the market for an off lease used Q50, and there a tons available under $25k with around 30k miles.
the market has been kinda crazy lately. acura was even blowing out TSX v6's for 300/month wtih 999 down. I mathed out the residuals and it pretty much equates to selling 42k msrp cars for a hair over 30 after incentives. wow.
It almost seems like the auto industry is embracing lease economics by assuming they don't make much money on the lease, but are banking on making money on the secondary market as a CPO after lease return...???
Exactly. People always talk about market floods and how much it saturates the market which may be true to a certain degree, but the manufacturer/banks will always make money in the end.
Its like this:
You lease the loss on the car, which is fair for the most part.
You use the car for 39 months and then give it back to the dealer.
Dealer then goes and sells the car for its value - usually 30k after a 3 year lease.
Someone buys it for that or close to it.
Infiniti essentially sold someone a full car at that point, just 2 owners...
What some are saying on different boards that Ive read is that BMW for example will not be as aggressive with pricing and residuals because they can "command it" to a certain degree. Also the fact that BMW requires their dealers to buy out a specific % of lease returns and CPO them which drives up the price. But as Sinecure mentioned there is still a limited market for such used cars, especially when you CPO them and raise the price.
The beautiful thing is that markets work themselves out as long as you sell to a person that can actually afford it. I hope Infiniti continues on with doing these deals because I want to get a Q60RS at the end of my Q50RS lease. I just dont see myself getting another Infiniti if they try to do mess with their prices and hike them up. There would be no reason to consider an Infiniti when you can get other luxury makes for the same money. May not have as much value but some are superior in other aspects.
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