Nissan Motor Co. Headquarters. Photographer: Keith Bedford/Bloomberg
Nissan Motor Acceptance Corp. is looking to extend standard leasing terms to 48 months from 36, in a bid to increase lease penetration to 30% of its portfolio, company President Kevin Cullum told Auto Finance News.
“I’m trying to push internally for our programs to support a diverse portfolio that will enable [NMAC] to take our lease penetration as high as 30%,” from 26% currently, Cullum said. “It will take an organizational and dealer-supported effort to make sure [NMAC] is managing marketing risk appropriately.”
Extending the standard 36-month term to 48 months will keep leases on the books longer. “Stretching [lease terms] a year longer makes sense because the collateral maintains its value much longer than it used to,” Cullum said, noting the change gives NMAC the ability to manage residual risk more accurately.
Parent company Nissan Motor Co.’s plans to release new models in the next 18 months will increase leasing penetration in the latter part of NMAC’s fiscal year ending March 31, 2020, Cullum said. “As we launch our all-new Sentra, Rogue, and Versa, we will be able to take advantage of increase lease opportunities,” he said.
NMAC had $28.1 billion of loans and leases outstanding, as of Sept. 30, 2018, according to a recent S&P Global Ratings presale report.
Source : AutoFinanceNews
