The Automotive Leasing Guide is what the auto industry uses to determine residual values for leased vehicles. It’s a pretty important guideline, and when the ALG speaks, people listen. So the ALG’s prediction of gasoline at $4.13 a gallon by 2013 has some pretty big ramifications for consumers and their vehicle choices.
Naturally, the ALG is predicting an increase in residuals for compact and hybrid cars. While compacts and hybrids should see a residual jump of nearly 10%, the big losers will be full-size SUVs, which should take a 7.4% hit in residual value. The same price fluctuations apply to wholesale values as well, with compacts and hybrids expected to bring 30% more at auction, while the same big trucks will go for 20% less.
Before anyone panics, let’s not forget that Canada has endured prices very close to $4/gallon for a few years now, and their vehicle makeup, while similar to the United States, skews more towards compact cars. While the best selling cars in America in 2009 were the Toyota Camry and Honda Accord, Canada’s favorites were the Honda Civic, Toyota Corolla and Mazda3 respectively. Bet that Civic Hybrid is looking like a good buy now, isn’t it?
[Source: Autoblog Green]