AMDA, AMAVe Present First-ever Report of Mexico’s Leasing MarketBy Alejandro Enríquez | Wed, 05/05/2021 - 07:00
The Mexican Association of Automotive Dealerships (AMDA) and the Mexican Association of Vehicle Leasing Companies (AMAVe) presented the first-ever report of the Mexican leasing market. "A few years ago, there was no data on our sector to show the market how valuable it is. This report is built on the efforts of many years to gain visibility for vehicle leasing while strengthening the products of our members," said Miguel Peña, Head of Research at AMAVe and one of the main authors of the study.
According to the report, during 1Q21 there were 9,318 new units purchased for leasing that represented 3.6 percent of total sales during 1Q21. This figure has grown 0.3 points from 1Q20 when recording began. On average vehicles for leasing share 3.1 percent of total sales per brand but for some companies the percentage is higher, such as Audi with 5.4 percent, Ford with 5.6 percent, Mitsubishi with 6.7 percent and Volvo with 7.7 percent. In volume, Nissan, GM and Volkswagen are the top three brands with the largest volume for leased vehicles, also known as leased assets, which remains consistent with regular market performance. As a share of total vehicle fleet sales, leasing companies accounted for 23 percent in 1Q21, a 0.4 point increase from 1Q20.
"Vehicle leasing has gained a solid reputation in our country not only for the tax benefits but also because of the added value that the leasing niche offers, such as fleet renewal and many different savings. As an association, we are paving the way not only to collect data but to address significant challenges for our segment," said Mauricio Medina, CEO of TIP and President of AMAVe.
Notably, vehicle leasing has also contributed to foster hybrid (HEV) and electric vehicle (EV) sales. In 2020, out of the 24,405 HEVs or EVs units sold in the country, almost 9 percent were for leasing.
As for heavy vehicles, sales to leasing companies represented almost one out of every four heavy vehicles sold in 1Q21. For Isuzu, for instance, vehicle leasing companies represented almost 50 percent of its sales, for Hino 42 percent and for Kenworth and International almost 11 percent each. Leasing shows a stronger performance in tract trucks rather than passenger vehicles. The report reads that from passenger heavy vehicle sales, sales for leasing companies represented only 2 percent of total sales during 1Q21.
"At AMDA every year we see how the leasing niche increases its importance. Even though in a strict sense leasing is not legally equivalent to financing it, we consider it is an alternative to acquiring assets. There are both company and individual customers using leasing, but the core market remains in placing active assets before companies in different segments. For us, a relevant task is to fill in the gap we had in the data. This report is relevant for decision-makers.