Detroit 3's share of rental fleet declined in 2015

U.S. deliveries to rental fleets in 2015 rose 9 percent to the highest number of vehicles since 2007, according to Manheim’s 2016 Used Car Market Report.

Photo credit: BLOOMBERG

General Motors, Ford Motor Co. and Fiat Chrysler Automobiles accounted for 60.1 percent of the 1.78 million new cars and light trucks sold to rental fleets in 2015.

It is the Detroit 3’s lowest collective share ever — even lower than the 60.6 percent share they captured in 2009 when the bankruptcies of GM and Chrysler forced rental companies to shift purchasing patterns, according to the Manheim 2016 Used Car Market Report released today.

Deliveries to rental fleets in 2015 rose 9 percent to the highest number of vehicles since 2007, the report said. The record for sales to rental fleets is 2.1 million units, reached in both 2005 and 2006.

Tom Webb, Cox Automotive chief economist, said even if new-car sales dip, automakers today have flexibility in their production and labor agreements and don’t have a pressing need to push vehicles into rental fleets.

Deals

But Webb also noted that automakers sometimes cut deals with rental companies.

“They’ve been good at adjusting production and a lot of that is related to the fact that they have flexibility in their production and their labor agreements,” Webb said. “No longer are you keeping plants open because you have to keep them open anyway.”

He added, though: “There are manufacturers that have particular models and they will give rental car companies that are big buyers some deals to get rid of them. There will be certain months and certain bargains” that reflect the need to dispose of excess vehicles.

New-vehicle sales through leases reached their highest level ever, “just shy of 4 million” units or 28 percent of light-vehicle sales in 2015, the report said.

BMW sold 59.6 percent of its new vehicles in 2015 through leases. Leases accounted for 53.8 percent of Mercedes-Benz’ new-vehicle deliveries.

Lease-leading Civic

The report notes that leasing is no longer just for luxury vehicles. For example, Honda sold 31.6 percent of its sales through leases. Citing data from Experian, the report said the Honda Civic had the highest unit volume of sales through leases.

Webb said about 3.1 million off-lease vehicles are expected to return to the market in 2016, up from almost 2.6 million in 2015. That pool of vehicles is expected to grow to almost 3.6 million in 2017 and almost 4 million in 2018.

Those vehicles are expected to put pressure on used-vehicle prices and it is possible that residual value losses will widen, the report said.

Webb believes that leasing companies won’t have trouble with residual value losses this year and will “probably be ok” in 2017 and 2018, “if the retail environment remains as favorable as it right now.”

He adds: “But it will be a challenge.”

You can reach Arlena Sawyers at asawyers@crain.com.


advertising

This entry passed through the Full-Text RSS service – if this is your content and you’re reading it on someone else’s site, please read the FAQ at fivefilters.org/content-only/faq.php#publishers.

Automotive News Breaking News Feed

Share This:

25 thoughts on “Detroit 3's share of rental fleet declined in 2015”

  1. Pingback: guitar tutorial
  2. Pingback: THC Vape Oil
  3. Pingback: 바카라사이트
  4. Pingback: review
  5. Pingback: check over here
  6. Pingback: شات
  7. Pingback: keto diet pills
  8. Pingback: paito hongkong
  9. Pingback: 토토사이트
  10. Pingback: Coolsculpting
  11. Pingback: corum replica
  12. Pingback: Immediate Edge
  13. Pingback: fun88

Leave a Reply