Nissan Lets Dealers Charge, Finance Up To $2,500 On Some Lease Buyouts

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The global pandemic and supply chain shortages have caused the most volatile auto market the world has ever seen. Thus, the mention of a higher price or a new fee attracts attention. Last week we heard about such a thing from Nissan, allowing dealers to add $2,500 in reconditioning fees to people who want to exercise their final lease purchase option. That certainly caught our eye, but as is often the case, it’s not that simple.

We first heard about fees from Live Carbut for starters, it’s not a cost at all. Motor1.com contact Nissan for clarification; The automaker confirmed that on March 9, a communication was sent to dealers outlining the new option through Nissan’s financial arm, NMAC. In short, dealers can now include a maximum of $2,500 in customer-approved reconditioning fees when financing lease purchases through Nissan. This also applies to Infiniti rental purchases. Previously, dealers were not allowed to do this.

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However, fees apply only to customer-approved repairs and rebuilds necessary for the vehicle to meet Nissan/Infiniti Certified Pre-Owned requirements. The lessee can still choose to purchase a vehicle without CPO status, in which case the standard contract applies.

Here’s Nissan’s official statement regarding this:

On March 9, NMAC and IFS communicated to all Nissan and Infiniti dealers about a new financing option for customers who wish to purchase their vehicle during the lease term who also wish to have their vehicle certified for CPO protection. Prior to March 9, NMAC and IFS will not allow customer-approved reconditioning fees associated with the certification process to be included in new NMAC or IFS Certified Pre-Owned (CPO) retail contracts. This update now allows a $2,500 limit on customer-approved rebuild fees. In addition, the reconditioning fee is limited to the repairs required to meet the CPO requirements, and does not include the CPO Certification Fee, which is paid by the dealer. As a reminder, Certified Pre-Owned (CPO) certification is NOT a requirement for customers to be able to purchase their rental vehicle, and should not be represented as such.

The obvious question at this point is, if the buyer can incur additional fees on the purchase of the lease, why bother with CPO certification? Based on nissan website, CPO vehicles come with a limited powertrain warranty and roadside assistance, and sometimes there are special financial offers through NMAC. In other words, obtaining CPO status on a lease purchase might give the buyer a better level of finance through the NMAC, although it could incur additional costs for the buyer which, conveniently, NMAC would now allow as part of the financing. And dealers will be paid for repair work.

So, what’s stopping dealers from charging buyers $2,500 for an oil change to meet CPO requirements? We asked Nissan that question directly, and the automaker explained that dealers can’t misrepresent the cost of the repair or service required. “The behavior violates its obligations, not only to NMAC, but also to its parent company Nissan North America, Inc., as well as applicable law,” a Nissan spokesperson said in an email to Motor1.com.

The timing of this announcement is particularly exciting, as it comes just two weeks after luxury brand Nissan Infiniti issued a warning to dealers over the cost of buying fake rentals. Reports emerged that some dealers refused to honor contracts, with claims that the state attorney general’s office was even involved in some situations.

As for why Nissan is now allowing dealers to apply a maximum fee of $2,500 for CPO lease purchases, a spokesperson said. Motor1.com this “allows NMAC to have greater exposure to dealer judgments about fees and costs in the lease purchase option process.”

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