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Honda Motor Co., Ltd. Message Board

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  • panacro panacro May 6, 2005 3:54 PM Flag

    The resale value BS exposed

    Resale values is not "BS" to be exposed. If you are the kind who buys a new car every 3 or 4 years, it can be $13,000 back out of your Prelude or $2,000 back out of your Pontiac Grand Prix. When the time comes to trade in one of these gems, the resale may be important to you. If you are a leasing fan, it is also important. Banks use these assumptions to determine (guess) what they will get back when a leased car is returned, which in effect determine the leasing rate. So, if you lease, if is also important to you. Note for investors: falling SUV sales could spell trouble for banks that are heavily into leasing if the falling sales drive down used vehicle prices enough.

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    • <<Note for investors: falling SUV sales could spell trouble for banks that are heavily into leasing if the falling sales drive down used vehicle prices enough.>>

      Banks and leasing companies have residual value insurance to protect them from such things. It may make their premiums go up but they are insured from loss due to increased depreciation.

 
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