The volume of expiring automobile leases is on track to increase 100,000 units — 5% — in 2015, then skyrocket another 800,000 units — 35% — in 2016, said Joseph Derkos, director of consulting and analytics at J.D. Power & Associates. Many of those vehicles will flow into the certified pre-owned market, Derkos told Auto Finance News. Specifically, lease maturities should reach 2.3 million next year, and 3.1 million in 2016. By comparison, about 2.2 million leases have expired in 2014.
“Recovery in leasing in recent years will drive growth of lease maturities,” Derkos said. As lessees move on to new vehicles, their old vehicles will hit the used market, where they’re increasingly likely to end up as CPO units due to their low mileage and typically higher quality condition. CPO is not just for luxury brands – 26 of 31 brands, including premium and non-premium, increased the proportion of their used vehicles that were certified in 3Q14 versus 3Q13, Derkos said.
