Leasing Continues Its Comeback

First Up 05/08/24

Leasing Continues Its Comeback

Dealers and auto lenders—primarily captive finance companies, which dominate automotive leasing—report a fairly strong comeback in the latest quarter, as automakers increase lease incentives as a way to offer more affordable monthly payments. The leasing comeback is particularly welcome for retail chains with a high mix of luxury brands, where leasing historically has been much more common than average. That’s especially true for the Penske Automotive Group, reports Wards. “We’re up 8 percent year-over-year, up to 32 percent of our new sales” from leasing, says Shelley Hulgrave, chief financial officer for Penske Automotive, Bloomfield Hills, Mich.   For context, lease penetration for the whole new-car industry was 24 percent of retail sales in the first quarter, up from 19 percent a year earlier, according to Power Information Network data cited by Ford Credit in its report on first-quarter results. Premium brands account for 72 percent of Penske Automotive’s worldwide revenue, the company says in a report on first-quarter earnings. Those include BMW, the group’s biggest seller by revenue, plus Lexus, Audi, Mercedes-Benz, Porsche, and Jaguar Land Rover. Click here for the full story.

Fender Benders Mean Serious High-Tech Repairs Now

Auto body repair was a pretty straightforward business not that long ago. When metal got bent in a crash, someone needed to unbend it. It was a craft. These days, it’s high-tech. Virtually every new vehicle sold in the last few years has sensors and cameras, including radar and sonar, throughout the body of the vehicle. According to CNN, those sensors dot the body of a car like little round buttons. Sometimes shiny black boxes are also embedded in the grille and what look like camera lenses are mounted behind the windshield up high near the rearview mirror. These have made the repair process more complex because, unlike a smashed fender, a sensor or camera can’t just be bolted or welded back on. To work, they need to be carefully and precisely aligned. It’s changed the process of collision repair a lot. “The change that we’ve seen in the last five years is greater than we’ve seen, probably, in the last five decades,” said Todd Dillender, chief operating officer of Caliber Collision, one of the biggest auto body repair companies in the United States with more than 1,700 locations across 41 states. Click here for the full story.

Mercedes-Benz Claims That 80% of All G-Wagens Are Still Roadworthy

Released in 1979, and updated several times since, the Mercedes-Benz G-Class earned a loyal following by offering enthusiasts above-average durability. The brand crunched the numbers and came up with a statistic to prove this point: 80 percent of the Gs built are still on the road. "The cars have a very long lifetime," said Mercedes-AMG CEO Michael Schiebe during a roundtable, reports Autoblog. "So here you can calculate [that while] maybe a G-Class needs a little bit more material than [your average] compact car, the durability, if you see the lifetime of a G-Wagen from 1979, I think you [will have had to have driven] many, many compact cars, in some cases, to keep up the lifetime of a G-Wagen," he added. Early examples suffered from rust-related problems, but they were available with many of the same engines found in some of Mercedes-Benz's most long-lasting cars, such as the W123. And every G-Class regardless of age benefits from rugged body-on-frame construction as well as a strong resale value. The 500,000th G was built in April 2023, so that means there are over 400,000 examples left to choose from if you can find someone willing to part with one. Click here for the full story.

CEO Koji Sato Reloads for Long-Term Growth After Leading Toyota to Record Profit, Sales, Production

First, CEO Koji Sato drove Toyota Motor Corp. to across-the-board record results — in profits, sales, revenue, and production. Now, he’s tapping the brakes to share the wealth. Outlining the best-ever earnings in a Wednesday news conference, the Toyota boss said his Japanese juggernaut will pull back from its red-hot expansion and re-invest its cash bonanza in suppliers, dealers, employees and a range of next-generation technologies from electric cars to software, reports Automotive News. Looking ahead, Sato said the company will stomach lower profits – a projected 20 percent slide this fiscal year — and tepid sales as it plows those bumper profits into the long game. “We need this time of plateau for our long-term future growth,” Sato said at a Tokyo news conference. “We would like to make proactive efforts for future sustainable growth.” On tap is a 42 percent surge in investment in “growth” technologies, such as electrification, software defined vehicles and artificial intelligence, to the tune of $11.24 billion. Click here for the full story.

South Korea Plans $7 Billion Push to Pivot EV Battery Industry Away from China

South Korea is dedicating around $7 billion to help wean its electric-vehicle battery supply chain away from China and align more with U.S. trade guidelines. According to The Wall Street Journal, the Ministry of Trade, Industry and Energy in Seoul said Wednesday that it will provide $7.14 billion in state financing to the local EV-battery industry this year to build up the country’s supply chain to continue to benefit from U.S. rules. The financial aid, which involves cheaper state loans and tax incentives, will help local EV-battery makers source critical minerals from the U.S. and U.S. free-trade partners. The money is also aimed at supporting the development of lithium-metal batteries or alternatives to replace graphite, a key battery ingredient, the ministry said. The move comes as South Korean EV makers and battery suppliers look to meet complex U.S. rules that take a tougher stance on Chinese manufacturers in the industry. One of the rules’ focus regards U.S. tax credits, which won’t be given to makers of cars that use critical minerals that come from China. Click here for the full story.


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