Is leasing the future of the auto industry?
The new Chevy Volt will be offered at $41,000, although the new plug-in vehicle will also qualify for a $7500 tax credit.
However, the Volt will also be available for lease, starting at $350 per month – much cheaper than financing a Volt purchase – thanks to the $7500 tax credit that GM can use to lower the payments on a three year lease.
Additionally, GM hopes to quell any concerns regarding reliability, particularly concerning the costly battery pack with its enticing lease offering. Moreover, GM believes that it will be able to reuse the battery packs in leased Volts to also help recover some costs.
So, if plug-ins are the future, is leasing to become the primary business model of the auto industry?
Once tax credits expire on the Volt, GM's Volt leases won't be nearly as sweet. Nonetheless, the re-usability of the battery packs might enable GM to keep leases a little lower than ownership, and keeping Volt prices as low as possible seems critical to any success. Nevertheless, without tax credits, it seems much higher Volt lease payments are inevitable.
What do you think? Is the Volt priced correctly? Is the lease deal a good move, or should the tax credits only be available to buyers?