Toyota Financial Services and Lexus Financial Services have been marketing off-lease inventory sales lately through ADESA DealerBlock. There should be a lot of used vehicles for dealers to choose from – Toyota and Lexus new vehicle sales have been about 30% lease transactions lately.
This Toyota program gives independent, non-franchised dealers access to off-lease Toyota and Lexus vehicles; these vehicles previously had only been available to franchised dealers. ADESA DealerBlock offers a 24-7 space to bid, buy, and sell inventory online. The Toyota off-lease program has been set up for daily sales to start at 7:00 pm and then end at 4:00 pm the next day. ADESA members can view the off-lease inventory here.
Toyota has been counting on leasing to drive its sales and strengthen market share. Its Camry is the number one selling car in the US market. Honda has been working hard at surpassing the Camry with sales of its Accord – that’s getting Honda to be more aggressive in its lease offers.
About 2.1 million off-lease vehicles will return to the market this year, up from 1.7 million in 2013, according to Manheim. Off-lease units are expected to drive down used vehicle values this year and beyond – even though that’s yet to be seen in the first four months of this year.
With about 30% of Toyota and Lexus models being sold through leases, residual values will be coming down. The company has set lower residuals for vehicles returning to market in 2016, said Greg Russell, national manager, risk at Toyota Financial Services.
The Toyota and Lexus captive finance companies started “aggressively pursuing leasing” in 2010 when new-vehicle sales had seen a downward plunge. That resulted in a record 39% increase in off-lease volume in 2013 compared to 2012, Russell said.
Toyota’s off-lease volume will come down a ways this year, due to the production stoppage following the natural disasters that hit Japan in March 2011. Then, they’ll rise again in 2015 and 2016, Russell said.
ADESA is also working with the Prestige family of franchised dealerships on prestigedealerdirect.com. It allows Prestige dealers to view and purchase vehicles in an online “closed” auction before the vehicles are offered through an open sale.
