Leasing regulation triggers car imports

Over 80% of foreign car acquisitions during the first quarter of 2000 were made by leasing. This new method was introduced at the beginning of the year and triggered a spectacular increase of 70% for car imports over the first six months of the year, Car Producers’ Association (APIA) executive manager Marius Carp told Ziarul Financiar.

“If these settlements had not been introduced, imports’ increase would not have been so substantial,” APIA official said.

Taking leases on a car involves several advantages for legal persons, given that rates are registered as deductible expenses. Another reason for which companies prefer to take leases on cars is that, as far as financial leasing (mostly used in Romania) is concerned, customs duties apply only to residual value, the interest rate generated by crediting being partially covered.

At the same time, buyers have the opportunity to choose, at the end of the contract, between buying the car at its residual value and returning it. As far as Romcar company, sole Ford importer, is concerned, about 90% of the first quarter’s sales were made by leasing. The percentage is even better for the Focus and Transit models.

On the other hand, Renault managed to conclude only one fifth of its transactions by leasing. “This is due to the fact that Renault does not have a unified leasing system yet, so that every concessionaire currently uses its own leasing operator,” Radu Hetco, communication manager at Renault Romania told Ziarul Financiar.

Another reason for car imports’ increase might be prices’ cut down. “Over the last four years, we witnessed a constantly descending trend for the prices of imported cars,” Carp said.