SUVs Not Just Bad For Planet, But Also Killing Lenders
Car as planter, Kensington Market, Toronto Image tionista
Leasing has been a popular way to buy a car; The lessor estimates its value three or four years down the road and you pay the difference, plus interest. So what happens when they guess wrong? What happens when there is virtually no resale value to the SUV when it comes off lease? We are beginning to see, as Chrysler closes down its leasing division, saying We've reached a point, in this environment, where the economic advantages of leasing have really disappeared." Ford has also taken a $2.1 Billion write-down on its leasing unit. An entire industry could disappear: "Leasing is based on the premise that you can somewhat accurately predict where values of cars are going to be," said Tom Webb, chief economist at used car auctioneer Manheim. "Right now, nobody has been able to do that."
Perhaps they will have to turn them all into planters. ::John Taplin
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