End of Lease Strategies?

[TimLee]

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Perhaps NMAC is starting to sweat having a huge inventory of three year old Leafs they can't sell.
...

There isn't any difficulty selling them.
Almost all lease vehicles get sold at auction.
Someone will buy them, the issue is how low the selling price will be.
Several have speculated that a lot of the LEAFs being auctioned are being exported.
Aren't many used LEAFs on dealer lots. They don't want them as they won't make much on them.

Interesting that NMAC may finally be wanting to reduce their end of lease auction losses by selling to leasor at something bit better than auction prices but a lot less than the original end of lease buyout.

[LTLFTcomposite]

You can sell a pair of dirty socks at auction. The question is at what price.
If the number of Leafs coming off lease far exceeds the number of used car buyers interested in rolling the dice on to what most is still little more than a curiousity, in a period of declining gas prices no less, NMAC stands to take a huge bath on these.
What are we talking, like 20,000+ cars coming off lease over the next year? I can see an easy $5k per car loss, maybe more, against the residuals. Tell me I'm wrong.

[LTLFTcomposite]

Oh I heard the export talk from a sales guy, that they were all going to be sent to the islands. Like they're paying top dollar?

[TimLee]

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What are we talking, like 20,000+ cars coming off lease over the next year? I can see an easy $5k per car loss, maybe more, against the residuals. Tell me I'm wrong.

I think you are correct.
Residuals were too high on the early leases and may still be too high for what the auction market will support.
NMAC may well have been losing $5K per vehicle so far.
Better to cut the residual for the leasor and only lose $3K.

A few were already buying them, but most were not.
A tricky choice for NMAC on how much to cut to minimize their losses.

[TimLee]

Oh I heard the export talk from a sales guy, that they were all going to be sent to the islands. Like they're paying top dollar?

Prices in many non-US markets for new LEAFs are ridiculously high.
As are the prices for replacement parts (See thread on UK LEAF owner that saved huge £ by purchasing emergency brake component from US.)
Don't think they are going to the islands, but quite a few are going to Norway and other European countries.

You do not find used LEAFs on car dealer lots in the Southeast US.
There is no demand for them so they are not there.

It may be different in CA and WA and OR.

[DNAinaGoodWay]

There's a used car lot here that is importing them from CA, typically asking $15k or so for a 2011.

One Nissan sales guy told me they ship some to Turkey.

The residual on my '12 is $21k and change.

[LTLFTcomposite]

If used car lots are asking 15, they may be getting 13, which means they're paying at most 10. Or even less based on additional risk it will be hard to find that retail buyer and thing will collect dust on the lot.

This is all idle speculation, but before accepting $10k or less for a 3 year old Leaf that had a 17k residual, Nissan might look at that capacity warranty cloud hanging over the car and ask if it's better to just scrap the cars. Wouldn't that be ironic, shades of EV1.

[LeftieBiker]

If I were offered the chance to buy my 2013 at, say, $13k instead of the $18k residual, I'd think about it. It would be a little hard for me financially, but if I could finance it at what I'm paying for the lease now, instead of facing either another substantial down payment or a much larger monthly payment, who knows? I don't think I'll lose the dreaded Second Bar for a few years with what I now know, and my driving needs are more modest now that I'm retired. OTOH, if few Leafs are showing up used, my original plan to sell the buyout option might become realistic...

[DaveinOlyWA]

what is % of cars of any type converted to purchase from a lease?

guessing, its pretty low meaning Nissan already has relatively accurate expectations of returns. maybe that is why they are so willing to extend leases?

[mm2001]

With my Leaf coming off lease soon, I'm trying to plan ahead for no surprises.

Any advice for the inspection? What sort of things are they looking for and what will they charge? E.g. our front has some kerb scrapes and there are some small side panel scrapes. I'm wondering if it's best to take it to a local smash repair/paint place and have them do touch up before I return it?

Any other suggestions for what is considered "normal wear and tear"?

Has anyone else had surprise costs when turning in their Leaf? Also, is this experience going to vary by dealer? (In which case, any suggestions for a good SF Bay area dealer to handle the return?)

Many thanks in advance!