Auto Leasing IS Back With A Vengeance

by : Khieng Chho

Auto leasing has become popular again after several years as the top auto companies in the US are trying to boost sagging profits and sales. In addition, the auto groups want to move away from offering large rebates and discounts on sticker prices. More leasing deals are expected to arrive to help rebuild their images and strengthen brand loyalty.

Various studies show that customers that lease a car will likely come back and lease the same brand. Leased cars give a better ownership experience, as they are almost under factory warranty. In addition, auto leasing enables drivers to use the latest models whenever they are released.

Auto leasing composed 21% of vehicle transactions in the US from December 2005 to February 2006. The sharpest rise recorded since April 2002, based on figures from JD Power and Associates. In February, auto leasing rose from 19.3% in the previous year and 15.2% in 2004 to 23.2%.

Ford's Red Carpet Lease is one of the premiere auto leasing programs in the US. The terms of the program are as follows:

RCL (Red Carpet Lease)- Ford Credit's main lease program is called Red Carpet Lease. The program gives consumers flexible terms and affordable options that are arguably the most comprehensive in the US auto market. Car drivers can expect to be using a new Mercury and Lincoln every four years under the lease program.

Gap Protection- the Red Carpet Lease features an option that allows the customer to waive the difference between the lease payoff and insurance payoff in the event that the leased vehicle is destroyed in an accident or stolen. Gap Protection comes with the RCL contract free of charge. The customer will only be liable for the lease deductible and payments that come under all amounts due and required under the lease.

Advance Payment Program: This Red Carpet Lease program allows the customer to immediately settle all monthly lease payments. The customer is awarded a special deduction in their monthly RCL lease payment. A final invoice will be given to the lessee for any unsettled excess wear, use and mileage and other related charges.

Peace of Mind- this option is specially offered to customers aged 62 and over who want to enter an auto leasing program but without the concern of making a financial burden for families. The Peace of Mind option is offered free of charge and allows the family to adjust the lease contract in the event that the lessee untimely passes away. Options include keeping the leased vehicle or terminating the contract by surrendering the unit.

ADDitional Security Deposits- A program under Red Carpet Lease that enables customers to pay several multiple security deposits in exchange for a lower monthly lease payment. Additional security payments could be used to settle various excess charges such as wear and use and mileage. Any fee not applicable to lease end charges will be reimbursed to the customer upon the expiration of the lease deal. However, the payments under the ADDitional Security Deposits cannot be returned during the duration of the lease contract.

Mileage Flexibility- Ford Credit's Red Carpet Lease features a wide array of mileage options and the flexibility to generate additional miles at the inception of a leasing deal. The option becomes active when the mileage base is 19,500 mileage a year, which is less expensive compared to paying for excess mileage that is due upon the end of the auto leasing deal.