What Nissan’s New Lease Option May Mean for the Automotive Industry

Leasing has been a popular way of driving a new car for years now. With lower payments than if you were buying a new vehicle, leasing gives people the opportunity to get a new SUV, car, or truck while easily getting rid of their older car. There are a lot of positives as well as negatives to leasing a new vehicle. One of the best parts of leasing is that you’re always getting the newest safety technology and features. Yet a drawback has historically been the cost associated with leasing, particularly at the end of a lease if the driver has gone over mileage. Now, Nissan is looking to change that model, attempting to make it easier to adjust for unexpected mileage overages. What impact will that have on car sales?

A front view of the 2022 Nissan Rogue
2022 Nissan Rogue | Joe Santos, MotorBiscuit

Nissan’s new lease offers more flexibility in choosing mileage

RELATED: How Much Does a Fully Loaded 2022 Nissan Armada Cost?

Nissan is offering a new lease program which offers more flexibility for people who aren’t sure how many miles they plan on driving during the year. According to Steve Parrett of Nissan, “Nissan’s new SignatureFLEX lease program eliminates the guessing game, allowing customers the ability to add miles during their lease term while avoiding potential end-of-term headaches.” It will initially be available on the Nissan Rogue, Rogue Sport, and Pathfinder in the fall of 2022, with more vehicles to follow in 2023.

What does that mean for consumers? Instead of having to guess beforehand how many miles you may drive in a year – and potentially pay big bucks down the road if you miscalculate – now, you’ll be able to be more flexible. Choose as few as 5,000 miles at the start of your lease, and buy more if you need them, at a rate of .10/mile.

People are driving fewer miles these days

It’s probably no surprise that people are driving less than ever. That’s at least partly due to the Covid-19 pandemic, which created a move toward working from home. According to Pew Research, 59% of people whose jobs can be remote are working from home. Before the Coronavirus pandemic, only 23% of people who could do their jobs from home were working from home regularly.

In line with that, Nissan says that while their most popular lease option in 2020 was for 12,000 miles, these days more people are choosing 10,000 miles. Not sure you need even 10,000 miles? You’ll be able to choose 5,000, and buy more if you need them.

What does this mean for the automotive industry?

RELATED: How Much Does a Fully Loaded 2022 Nissan Rogue Sport Cost?

According to Statista, 1 out of 4 vehicles in the United States are leased. Why? It likely has to do with the appeal of owning a brand new vehicle, and not having to deal with the downsides of an older car. After all, if you lease a new SUV every few years, the chances that you’ll have to deal with a major repair or other unexpected expense is generally pretty low. In addition, you’ll always get brand new technology, which can also include safety features, making leasing especially attractive.

Yet leasing has always had its drawbacks, including not gaining equity in your vehicle and sometimes being surprised by extra fees at the end of the lease. With more flexible leasing options, we could start to see leasing become even more popular. This is especially true as starting prices for cars rises, and fewer people can afford the vehicles they want.

It will take some time before we see the long-term impact of Nissan‘s new leasing program on the automotive industry. Perhaps other automakers will follow suit, and there will be a large scale change among the leasing landscape. One thing’s for sure – anything that makes it easier for people to get a vehicle when they need one will likely be positively received.

RELATED: Should You Buy a 2022 Nissan Rogue, or Wait for the New 2023 Rogue?