In the 1980s, the Canadian economy had high housing prices, double digit inflation, a staggering national debt (yes, government budget deficits) and interest rates from 12% to 15%. Car manufacturers were even mandating price increases during a model year. And as the prices continued to increase, finance contract payments were starting to become very expensive and a normal term was stretched from 36 to 60 months.
To find a lower cost solution for new car buyers, the automakers began to offer retail leasing through their in-house finance companies. Ford of Canada was one of the first to the market in the mid-to-late 1980s followed by General Motors and the Chrysler Corporation. By 1990, retail leasing had become a very popular new car acquisition method but there were challenges that came with this low monthly payment solution. From time-to-time, customers needed to get out of their leases and the costs were exorbitant and unaffordable for most leasing customers.Read more
In 1990, LeaseBusters offered a solution to help leasing customers get out of their car leases along with a way for one-owner used vehicles to present their vehicle to leasing customers that included a built-in lease contract – the birth of the Lease-Take-Over (LTO).
At first people were skeptical so we focused on education. Dealerships and leasing companies were not ready or willing to help their customers with affordable alternatives – they made getting out of leases prohibitively expensive for their customers. But we didn’t. We made it easy.
Our persistence at education paid off with a little help from the press. Customers soon understood the offer we were promoting. Over time, factory leasing companies began to accept the LTO solution. They had to; we were here.
Then as the Canadian economy came out of the recession in the mid-1990s, interest rates declined and the new car leasing business began to surge. We knew our option was still viable and we added upgrading as a reason to change a lease. Our previous education was about helping clients downsize…but now there was more than one reason to get out of your lease. The question was how were we going to compete with the new car leasing business.
Technology was the answer. In the late 1990s there was tremendous growth in technology. We secured our domain www.leasebusters.com, and in 1997 prepared for the new millennium with a new mission and an enhanced business plan.
By the early 2000s, thousands of people had visited our site. Leasing was becoming a popular option for many. And as Canadians leased more, a significant percentage wanted to change their cars more often…LeaseBusters became the solution for these customers. And thanks to the technology of the internet, the message was across Canada in an instant.
Dealerships took notice of LeaseBusters and what we had to offer and wanted to work with us. In 2001, we introduced the dealer affiliate program and initiative. In October 2006, we formed a strategic alliance with GMAC (Canada’s largest vehicle leasing company).
Today we host over 300,000 visitors a month. And we are a fully bilingual site. We have a Quebec satellite office.
We’re most proud of the fact that our initial idea of lease take overs has now been accepted in the marketplace as a vehicle acquisition choice. Now you can choose between a used car, or LTO.