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Ford has announced that it will be making changes to their leasing policies. Following Chrysler’s lead, Ford said that it will raise its lease rates and avoid leasing to high-risk customers due steep losses as residual vehicle values plummet.
The news that Ford is changing is strategies when it comes to vehicle leasing comes a day after Chrysler announced it will stop leasing vehicles completely. Extreme losses have put a damper on automakers as resale values, especially for trucks and sport utility vehicles, have declined significantly following lease periods.
Ford Motor Credit is not, at this time, taking the same measures as Chrysler in avoiding auto leasing altogether, but they will be taking strides to reduce the current losses associated with leases and will curb the amount of loans provided to those who have poor credit ratings, which has been a goal at Used Cars Richmond and many other dealers since the initial problems within the credit industry.
Lease prices set by Ford and other automakers are based on the perception of future depreciation following the term of the lease period. Ford also reported that the already struggling company took on a $1.8 billion loss thanks to record high gas prices that have contributed to lower consumer demand and reduced resale values when it comes to pickup trucks and SUVs following lease periods. Still, some Ford dealers have managed to keep truck inventories moving, such as those dealers like Commercial Trucks Richmond that offer commercial vehicles catering to businesses. Although Ford Motor Credit will still be leasing vehicles, customers will likely find higher rates on those leases to align with current depreciation expectations.
Look for these new lease price hikes beginning August 1st. These lease prices will be applied to Ford’s F-150 and Super Duty trucks as well as Explorer and Sport Trac.
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