DALLAS, Texas – Trying to get a hesitant vehicle buyer to commit? A new walk-away lease program may help you do just that.
MotoLease and EFG Companies have partnered to offer the SelectGuard program, which lets customers lease a motorcycle with the option to walk away if circumstances change -- for example, if they lose a job or incur an unexpected expense.
Consumers get a safety valve that lets them out of a lease without negatively impacting their credit history. For retailers, it’s a way to get customers onto a bike.
SELLING PEACE OF MIND
Selling peace of mind could be a good opportunity for dealerships, and has history in the auto sector, said Rickey Beggs, managing editor of Black Book.
"It was a great program for Hyundai in a time when consumer confidence about the economy was at a very low point,” Beggs said. “My understanding is that there were few instances where consumers did actually walk away.”
“This could be a great tool for the motorcycle industry ... for the same reasons it worked within the auto side. Sure, consumer confidence is better today than when the Hyundai program was in effect in 2009 to 2011, but there are still concerns that exist today,” Beggs said. “I think it would be important to offer this on all transactions, not just to consumers who are hesitant to move and make the purchase/lease.”
It's an interesting marketing effort to support sales, Beggs said, "and especially to a consumer who might be a little unsure of some scenarios within their work, business or possibly health. The walk-away programs eliminate some financial concerns."
Starting this month under the SelectGuard brand, all MotoLease leases will include complimentary limited coverage, including six months' vehicle return and 12 months of roadside assistance. Customers have the option to upgrade to full lease term coverage within 10 days of signing the lease.
About MotoLease and EFG. MotoLease is a financial services company that offers consumer leasing programs for powersports vehicles, and targets subprime credit customers. The company is teaming with EFG Companies’ motorsports division to increase market share.
“Going into 2014, we knew we had to get ahead of industry trends, and leasing gives customers the ability to get into a bike without having the extra financial burden of an outright purchase,” said Emre Ucer, managing partner of MotoLease. “EFG demonstrated agility and innovation within their product development and administration that we felt would greatly enhance our ability to achieve our goals.”
EFG is the company behind the Hyundai Assurance program launched during the peak recession years. Since then it has private-labeled its auto return, vehicle service contract and roadside assistance plans, offering them directly through dealers. “We are exclusive in the United States with that product,” said Glenice Wilder, vice president of EFG Motorsports.
EFG also offers the coverage as a stand-alone product, so far through about 50 Harley-Davidson dealers and 10 independent retailers. Partnering with MotoLease is a way to expand the program for the powersports market. EFG not only offers the coverage for motorcycles, but has quietly offered the Extreme walkaway lease program for off-road vehicles since 2009.
“One of the things we are finding in working with motorcycle dealers is there is a lot of F&I opportunity that they have not been able to develop to the extent that auto dealers have,” said EFG spokesperson Jenny Rappaport. In a company survey of 1,000 people who said they had either bought a vehicle in the last year or planned to in the next 12 months, 91 percent of respondents indicated that vehicle return coverage “would significantly impact their decision to buy a vehicle within the next 12 months,” she said.
For dealers using MotoLease, they can now offer the extended SelectGuard products. The protection programs are available on the same web portal to save time for F&I personnel.