If irrational exuberance takes hold again and artificially low, unsustainable lease rates are used to pump up sales figures, it's hard to see how we're not in for an eventual crash. Attractive lease deals on brand-new models like the Chevrolet Cruze are cause for concern to some analysts. Leasing is more often used to move luxury vehicles and aging models, so coming out of the gate with a sharp lease deal smacks of a grab at market share. General Motors counters that it has merely brought leasing back to 15-20 percent of sales, a healthy level, and it's being careful.
Dealers are happy to see the increased showroom traffic the new surge in leasing has brought. Many stores saw sales implode as the recession was busy taking everyone off a cliff. Being able to offer a popular car with an affordable payment again is an effective sheepdog to direct people into dealerships, and besides, the used car market has been depleted for months thanks to measures like Cash For Clunkers and people holding on to their cars longer, keeping them out of circulation.
[Source: The Detroit News]