These costs cover customer-approved repairs that are required to attain CPO status using the lease purchase option.
Global pandemics and shortages in supply chains have created the most volatile market for automotive products the world has ever seen. Any mention of new fees or higher prices is a big deal. We heard last week that Nissan was offering $2,500 in reconditioning fees to anyone who wanted to buy out their end-lease option. This caught our attention. However, as it is often, it’s not that easy. We were first informed about the CarsDirect fee. However, for starters, it is not a fee. Motor1.com reached out to Nissan for clarification. On March 9, Nissan sent a communication to dealers describing a new option through NMAC, Nissan’s finance arm. Dealers can now finance a lease buyout through Nissan with a maximum $2,500 in customer-approved rehabilitation costs. This also applies to Infinitilease purchaseouts. This was previously prohibited by dealerships.
The charges are only applicable to repairs and reconditioning that customers approve to make a vehicle meet the Nissan/Infiniti Certified pre-owned requirements. The standard contract still applies if the vehicle is purchased by lessees who do not have CPO status. At this point, the obvious question is: if buyers are subject to additional costs for a lease buyout then why bother with CPO certification? Nissan’s website states that CPO vehicles include a limited warranty on the powertrain and roadside assistance. Sometimes, NMAC offers special financing deals. CPO status may allow buyers to get a lower finance rate through NMAC. However, it might come with an additional cost that the buyer is willing to pay. NMAC now allows this as part of their financing. The dealer would be paid for the repairs.
What’s stopping a dealer from charging $2,500 to customers for an oil change in order to comply with CPO requirements? We asked Nissan this question and they replied that it was illegal for a dealership to misrepresent the cost of repairs or other services required. “This conduct violates its obligations, not only to NMAC, nor to its parent company Nissan North America, Inc. as well as any applicable law,” a Nissan spokesperson said in an email to motor1.com.
This announcement comes two weeks after Infiniti, Nissan’s luxury brand issued a warning for dealers about bogus lease purchase fees . There were reports that dealers refused to honor lease agreements, and that the state Attorney General was involved in certain situations. A spokesperson for Nissan explained that dealers can now apply a maximum cost of $2,500 for CPO leasebuyouts. He said Motor1.com that this “enables NMAC to have greater exposure” to the dealer’s assessment and fees in the lease-purchase option process.