Autoblog

Toyota Financial Services recently leaped over GMAC Financial services to take the lead as the biggest U.S. auto lender in terms of loan and lease contract volume. The study by AutoCount (a unit of the Experian Automotive company) estimates that Toyota captured 6.35% of the market from January through June, while GMAC had 6.2% for a close second place. Rounding out the top five were Chase Auto Finance, American Honda Finance, and Ford Credit (in that order).

As GMAC has made major cutbacks in leasing over the summer, many industry experts expect Toyota to hold its lead through the end of the year. A spokesperson from GMAC was quick to point out that the study did not include two wholly owned subsidiaries: Nuvel Credit and National Auto Finance. When those two companies are included, GMAC's share increases to 6.72 percent -- effectively placing them at the top again. While the automakers battle for the title position, the independent banks are the ones to watch. They've been steadily increasing their lending share as the Detroit 3 struggle with the rising costs of funds and declining credit ratings.

[Source: Automotive News, subs. req'd]

The Detroit 3 aren't the only automakers feeling the hurt from lease vehicles coming back worth much less than expected. Leases account for 60% of BMW's sales in the U.S. compared to just 20% of sales in the industry as a whole. As such, BMW will begin offering incentives like never before to encourage customers to buy a vehicle instead and reduce the number of leases it has on the books. In some cases the German brand is offering loans with finance rates as low as 0.9% over five years, and of course these incentives will be aided by a commensurate raise in lease prices, as well.

Nearly all luxury makers are in the same boat as BMW, as Bloomberg reports that leases also comprise 55% of sales at Mercedes-Benz, 43% at Lexus and 42% at Cadillac. While the residual value of luxury vehicles isn't falling quite as fast as SUVs and full-size trucks, the market's shift in preference to smaller, more fuel efficient vehicles means that there is less demand for vehicles that tend to conspicuously consume copious amounts of fuel. Thanks for the tip, Rich!

[Source: Bloomberg]

Chrysler LLC's financial division will no longer be offering leases to U.S. consumers on Chrysler products as of August 1st. The automaker will be holding a conference call with dealers later today to go over the changes and the reasons behind the decisions, but Chrysler spokesperson, Bill Porter, told Reuters "We are shifting our strategy to focus on retail products."

The move comes amidst Chrysler's attempt to get 20 banks to renew a $30 billion credit facility for the automaker's financial arm. The rise in borrowing costs next month will make it more difficult for Chrysler to offer low-interest loans and could spell further disasters on the sales front.

Thanks to all who tipped in.

[Source: Reuters, WSJ]

Click on the image above for our high-res Hyundai Genesis gallery

To lure buyers towards the all-new 2009 Hyundai Genesis luxury sedan, the Korean automaker is aggressively pricing lease programs. Traditional Hyundai customers choose to lease about 10-12 percent of the time. The Genesis, however, is aimed at a more upscale buyer -- a segment that tends to lease more often (according to Hyundai's estimates, 50 percent of the Genesis customers will lease the new sedan). To drive sales, the standard six-cylinder model, with a base price of about $33,000, will lease for $399/month (24-month lease with $2,199 due at signing). It's a deal that undercuts the Cadillac CTS by nearly $150/month, according to a retailer who sells both. With 80 percent of customers expected to choose the V6 model (we would too), the lease program is bold enough to drive traffic. In case you were wondering, the V8 model won't be in showrooms for another month, and by that time the lease program will have expired.

[Source: Automotive News, subs. req'd]

By most estimates, there are about 250 million registered passenger cars in the United States (you can drop the number down by a few hundred if you still don't consider the Yugo GV a car). For many motorists, it seems that every single one of those cars is trying to park in their location -- their frustration of looking for parking is only compounded by the countless unused parking spaces that sit empty all day long.

Less than two years ago, a 24-year-old entrepreneur from London, England, launched ParkAtMyHouse with the intent of marrying despondent drivers with unused parking slots. Overnight, the "driveway rental business" was hatched. His site connected drivers with open parking spaces in Great Britain in a rather simple manner. The Internet-based program asked visitors to input either an address, postal code, or area name. The search results displayed on an easy-to-read Google map, with clickable icons representing the parking locations and their associated fees. The clever idea caught on, and their resulting success was the catalyst for recent expansion to the States.

On this side of the Pond, the "driveway renters" won't find themselves alone. Other companies such as ParkingHunter and ParkingSearch have already established themselves in the sector. All of the sites operate in a similar manner, keeping the learning curve shallow for newbies. And, since fees only change hands once the slot is rented, nothing prevents a parking space from being listed on more than one site. Now, if they could just get the system to work at the mall during the holidays...

[Source: ParkatmyHouse]

In order to sell the Chevy Volt for $30,000 or less, General Motors is considering leasing the lithium-ion batteries to customers who buy the car. As AutoblogGreen points out, renting car parts is an innovative strategy to get the Volt to market in time and at the right price. Having a car payment and a battery payment, however, might not be fun for Volt owners. The upside, however, is that GM would presumably warranty the batteries for the life of the lease, easing concerns over what happens to the battery packs if and when they fail.

In a way, GM has used this tactic in the past. Back in the day, the EV1 electric car was only available to lease, not to own. Of course, as most of us know, leasing the EV1s eventually bit GM in the arse when it went to retrieve the cars and encountered significant resistance from owners who had become attached to them. This plan seems to get around that issue, as a Volt owner will actually own his car, just not the batteries. Of course, if GM ever decides to ask for the battery packs back, owners may be left with a giant generator on wheels.

[Source: AutoblogGreen]

Honda has decided to settle a class-action lawsuit that alleges its odometers were racking up miles too fast. The automaker says odometers on some 6 million Hondas affected by the suit were accurate to within 3.75% on the high side. The NHTSA doesn't regulate odometer accuracy, and the only industry standard is a voluntary one set by the Society of Automotive Engineers that says odos should be within +/-4%. While the car's affected by the suit fall within that range, Honda recognized that its customers expected their odometers "would be based on zero," and they weren't.

The settlement will lengthen the warranty mileage of affected vehicles by 5% and Honda will pay lease-mileage penalties incurred by owners, which is expected to cost the automaker around $6 million. If you own a 2002 to 2006 Honda or Acura bought between April 12, 2002 and November 7, 2006, then you're eligible for the benefits of the settlement.

The lawsuit also prompted lawyers to test the odometer accuracy of other vehicles. It was found that on average domestic vehicles were nearly perfect in their odo accuracy, while Toyotas actually racked up fewer miles on the clock than they did in reality. Nissans, however, didn't fare as well, and a new class-action suit has been filed on behalf of Altima owners who say their odometers are counting the miles 2.5% to 3% faster than they should.

[Source: USA Today]

Thanks for the tip, John!

Though not many noticed, Toyota employed the use of incentives to increase sales of its Prius hybrid for the first time ever in January. The incentives varied around the country and included low lease payments, cheap financing and cash back to dealers for each unit sold. Automotive News reports that in New York state, customers could order up a Prius lease for just $249 per month. In Michigan, Ohio and Kentucky, shoppers could finance the little guy for 3.9% for 36 months.

Toyota's goal is to reach 150,000 Prius sales in 2007, which is a large jump by any measure considering that only 106,971 units were sold in 2006, down from 107,897 in 2005. We remember a time when the line for a Prius was out the door and interested parties waited months for delivery of one of those shiny, new Priuses. It's interesting that in just the first month of 2007, Toyota has already resorted to incentives to ensure that its goal of 150,000 sold remains in sight. For its effort, the company was rewarded with the best January for Prius sales yet. Sales were up 8.4% with 8,299 units sold. There's still a long way to go, however, to hit 150,000.

If you were hoping to get a sweet deal on a Prius after reading this – sorry, the incentives reportedly ended on January 31st.

Thanks Aaron for the tip!

[Source: Automotive News – sub. req'd]

Cars are becoming increasingly affordable? It hardly seems possible given today's economy, but statistics show that a new vehicle purchase takes a smaller bite out of your wallet today than it has in years.

You can bet that huge incentives and subsidized leases have been a factor in bringing those costs down. Bloated inventories have forced automakers to do whatever it takes to sell vehicles that are sitting not only on dealer lots, but in storage yards around the country. These factors have helped the average cost of purchasing a vehicle today fall to an average of 23.6 weeks of income for a family making $58,000 a year. That's nearly three weeks fewer than five years ago and 7.3 weeks less than in late 1994. Average vehicle prices have dropped 5 percent over the last year to $26,500, while median family income rose about 5 percent.

Several dealers have had customers come in to buy a vehicle with paperwork from a vehicle purchase from the mid-80's and the price of the new vehicle is only a couple of thousand more, some with dramatically lower payments. While everyone seems to complain about how expensive things are today, it certainly doesn't seem to have affected what they drive.

[Source: Detroit News]

We had always operated under the assumption that there's no quick way to make a buck in the auto business. Turns out we were wrong, as DaimlerChrysler has just sold its headquarters in Stuttgart for $308.8 million in cash to IXIS Capital Partners Ltd. Don't fret, the building's new owners won't be kicking DCX to the curb, as the automaker simultaneously signed a 15-year lease to stay on the premises. The money from the sale will boost the automaker's operating profit by $22.9 million this year, as DCX is required to report income over the duration of the lease. It's perhaps the fastest $380 million profit we've ever seen a carmaker turn, and the most creative. Chances are that if DCX is doing well in 2021, the automaker will buy its HQ right back.

[Source: Automotive News]