Second-hand car leasing more dynamic

Porsche Leasing”s general manager, Bogdan Apahidean, estimates that funding in leasing for second-hand cars will increase faster than for new cars this year.

“The leasing market in 2006 will register a 10-15% growth pace, with the second-hand leasing segment progressing faster, by some 20%,” says Bogdan Apahidean, Porsche Leasing general manager.

The leasing company, one of the main players in its field, is present on the second hand car leasing market through Weltauto, Porsche”s own brand for the trade in used vehicles.

“The used vehicle leasing market is just starting, and the growth potential is very big. This will be the last year to see such high growth for the sale of new cars, with the new car market set to go down from 2007 due to the increase in the import of second-hand cars,” Apahidean says.

The leasing of used vehicles in 2005 accounted for less than 3% of Porsche Leasing”s portfolio, but was up compared with 2004. Apahidean expects funding in leasing for used cars to double this year. The used car leasing business carried out through Weltauto is regarded by Porsche Romania officials as a solution to encourage the purchase of new cars, as well as to ensure customer loyalty towards the brands in the dealer network.

Leasing companies are generally reluctant to take the risks involved in funding second-hand cars. However, Apahidean believes that the fiercer competition may push smaller companies to penetrate the niche markets created by the various methods used to sell second hand cars.

“Many companies will have to go for used car funding to be able to cope on the market, though the major companies will not take the risks related to the source and technical condition of vehicles in this category,” he added.

Another segment that could see growth above the market average is operational leasing.