Detroit's Losses Mean Higher Car Payments for Leases

[WishIhadatruck]

Resale values of trucks and traditional suv's is way down and that is not going to change anytime soon if ever. Many people leased these vehicles because they could not afford to buy them. Due to reduced residuals leasing is now just as expensive as buying so it is not an advantage. I don't see how GM created this issue. A poor economy with high gas prices has changed this for all automakers. GM's problem is they don't have high resale values in cars like companies such as Honda and Toyota leases on cars and small cuv's will not be as attractive without incentives at GM.

[delmarjohn]

what most people still forget is the consumer tires of the auto dealer...when leases fade away ...you are now stuck once again negotiatingthe TRUE value of your trade...been threre done that dislike the whole process ....once again this a perfect time to change once and for all HOW cars are purchased and the trade in policy...I for one do not have the time or patience to deal with the dealer process....I have purchased or leased 28 cars in my lifetime and by far the easier process.....just anote now that leases are unattractive because of declining residuals how much money are they making on the ones they are able to sell at sticker price.....also if all cars are sold at reasaonable profit and not the gauging recently seen on the SUVs and trucks.....then why does a change in fortune require such drastic action ...WHY poor management....also too many layers in the selling process...the dealer model needs to go away....truly are there many people out there that actually love their dealer and the process

[delmarjohn]

Also ...in my humble opinion...you just can't lose ..the percieved value of your home on a monthly basis and feel comfortable...here in california just last year home values dropped 24%...and on my humble abode that meant that meant a loss of $15,000 per month.....so it really is not $4.00 gas ,but the economic mess we in this country have gotten ourselves in..and we are all to blame why ....we are the enablers of the policy makers that got us in this mess ...WE REFUSE TO GET INVOLVED....also we are mortgage writers and the insurance agents and the appraisers and well you get it...as long as our hand was getting greased we very capably LOOKED the other way

[lio45]

Originally Posted by fp115

Not sure how that was all calculated. A lease on a Vue with an MSRP of about $27.5k comes up to about $490 a month. The RDX with about a $33.7k MSRP comes up to about $660 a month. Neither of which include taxes and down payments. Both are on 36 month terms.

How did you get these numbers? Without even seeing the details I know you must have way underestimated the gap in market value between the GM and the Honda at the end of the leasing period.

[fp115]

Originally Posted by lio45

How did you get these numbers? Without even seeing the details I know you must have way underestimated the gap in market value between the GM and the Honda at the end of the leasing period.

The Vue numbers are based off a dealer estimate and the RDX is based off this weekend's dealership Acura ads.

[Ed753]

Originally Posted by delmarjohn

Also ...in my humble opinion...you just can't lose ..the percieved value of your home on a monthly basis and feel comfortable...here in california just last year home values dropped 24%...and on my humble abode that meant that meant a loss of $15,000 per month.....so it really is not $4.00 gas ,but the economic mess we in this country have gotten ourselves in..and we are all to blame why ....we are the enablers of the policy makers that got us in this mess ...WE REFUSE TO GET INVOLVED....also we are mortgage writers and the insurance agents and the appraisers and well you get it...as long as our hand was getting greased we very capably LOOKED the other way

John, if it makes you feel any better, your house was never really worth $750,000 sure hope you didn’t pay anything close to that, probably not worth the $570,000 you think it is today either, the problem is all the people that OVERPAID, and hence stopped paying and just walked away, which is easy when one is negative equity thousands of dollars……………………

Many of the people that could "afford" to buy a $75,000 Escalade, did it via, refinancing (cash-out) of their appreciated property.