Car lease facts: why car manufacturers lease cars they don't make

  • Did you know VW can offer leasing on Jaguars?
  • Mostly for business customers
  • Car makers don't just make cars

If you read a lot of car-related news and features, the adverts served up to you tend to be car-related in some way.

If this is the case for you, you may well have encountered an advert for a car manufacturer offering a leasing deal on a car that it doesn’t actually make.

It may look like nonsense, it might even look fake. But it’s real.

VW I-Pace

Why do car manufacturers lease cars they don’t make?

In short, it’s a business decision. Car manufacturers are no longer simply manufacturers of cars. Big companies now have financial subsidiaries, and many of them offer ‘fleet solutions’ for businesses.

This is why Volkswagen leases Jaguar I-Paces, among other non-VW vehicles.

Lizzie Meeke, communications executive for VW Finance, explained: ‘The fleet side of the VW Financial Services business is multi-marque and therefore works with brands that aren’t (VW) group ones.

‘VW Financial Services needs to be able to offer lots of brands, rather than be limited to specific brands as it is a business to business service.

‘No matter the make or model, we only offer our customers the right vehicle for the right people. Whether that is a Volkswagen Golf or a Ford Transit, we will fund and maintain any make or model up to 3.5 tonnes. This even covers all fuel types, including plug-in hybrids, electric cars, as well as petrol and diesel cars.’

Car finance deals:

Alphabet, a leading fleet business company, was established in 1997 and is a subsidiary of BMW.

A cursory flick through its website reveals its car leasing deals are not in fact on high-end BMWs, but on much cheaper cars such as the Nissan Qashqai and Volkswagen Polo.

David Jones, Communications Manager for Alphabet, says: ‘We lease non BMWs because that’s what our customers need. If you’re a large corporation, you may want different tiers and different cars for different positions.

Commercial vehicles are big for us, and BMW doesn’t make any commercial vehicles, so of course we offer Ford Transits.’

Leasing subsidiaries such as VW Financial services, Alphabet, and Leasys (Fiat’s leasing subsidiary) don’t just offer leasing, they provide ‘mobility solutions’ for businesses.

In short, car manufacturers lease cars they don’t make in order to make money.

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