(Not) leasing; where is the logic?

[Brigadier]

Could someone explain the rationale behind the following please, as neither myself nor my friend (the person affected) know.

Friend leases a Jag iPace.
Had it for almost 2 years, and loves it.

Now has a Volvo electric something or another on order, again on lease.

Why are you getting rid of the Jag, if you love it?, I asked him.

They won't let me extend the lease, he replied.

Why won't they do that?
What will happen to a 2-yr old Jag iPace, when it comes off his lease? I presume they won't lease it to someone else, so will they sell it on, or even dispose of it at auction?

Just seems daft that someone actually wants the car, but they don't want him to have it............

 

[bernardgreen]

I believe the reason for limiting the duration of a lease agreement is the re-sale value of cars coming off lease has to be high enough to ensure an overall profit to the leasing company.

 

[Mottie]

Easier to sell a two year old car with a year of manufacturers warranty than a three year old one without any manufacturers warranty.

 

[conny]

I was under the impression that you had the option to buy after the lease was up.
Or is that a different scheme?

 

[Brigadier]

I was under the impression that you had the option to buy after the lease was up.
Or is that a different scheme?

I don't know what his scheme is / was.

Might go to prove my point that a lot of (most?) posh motors are driven by those who can't afford to buy them, but only to finance them.

 

[Brigadier]

Just checked on Autotrader.

a 2020 iPace in his spec and colour - £35k

 

[Nige F]

I was under the impression that you had the option to buy after the lease was up.
Or is that a different scheme?

I think that's the modern Hire Purchase where you pay for a fixed number of years then can return the car and owe £0. or pay a " balloon payment" and it's yours . What we've got on our Citroen C3 Aircross.

 

[DiyNutJob]

Might go to prove my point that a lot of (most?) posh motors are driven by those who can't afford to buy them, but only to finance them.

It's also possible some people just like to drive new cars. Leasing is cheaper than buying consecutive new cars. If your friend liked that car so much, why didn't he lease a newer model of it?

 

[Brigadier]

It's also possible some people just like to drive new cars. Leasing is cheaper than buying consecutive new cars. If your friend liked that car so much, why didn't he lease a newer model of it?

I have no idea.

 

[flameport]

Could someone explain the rationale

It's a car lease. The sole purpose of which is to make massive profits for the lease company.
What people may want, like or need is unrelated.

 

[Diver Fred]

What is the duration of his lease? 2 years or more?

If it's 2 years and very low milage then it's in the leasing companies benefit to enforce the change. They can sell on for a higher price.

 

[big-all]

It's a car lease. The sole purpose of which is to make massive profits for the lease company.
What people may want, like or need is unrelated.

no expert but if their deals are not competitive they won't be in business for long ??

 

[robinbanks]

no expert but if their deals are not competitive they won't be in business for long ??

Unless their business model is akin to DoorDash or WeWork

 

[DiyNutJob]

no expert but if their deals are not competitive they won't be in business for long ??

They can buy new cars cheaper any way. So, you can be sure they make a profit. It's in the manufacturer's interest to make these taster cars available to serve as on road advertisements. The leasing cost will likely to be driven by the number of leases. They don't want the number too high, nor too low.