Why did the Ford division step up its activity in the leasing Field through its Ford Authorized Leasing System?

To get this answer, Automotive Fleet went to James J. Larkin, manager of the leasing department at Ford.

First off, Larkin wanted to clear up the mis­conception that Ford itself is leasing cars.

"This, of course, is not the fact," Larkin said. "Stated in simplest terms, the Ford Authorized Leas­ing System is an association of Ford dealers. Ford has placed its personnel, know-how, national facilities and famous trademark at the disposal of dealers to improve their competitive position for vehicle leasing."

Larkin, who has been manager of the Ford divi­sion leasing department since 1958, believes that no one in the auto business can afford to ignore leasing. This is why Ford launched FALS.

Powerful economic considerations make leasing or car rental an attractive alternative to car owner­ship for business firms, professional people and even for individuals for private use," Larkin explained. "Leasing and rental grew rapidly in 1957-58 even as the general car market declined. Today, leasing is still growing with the general market at near-record highs."

According to Larkin, who joined Ford Motor Co. in 1936, the auto dealer today is faced with some basic questions regarding leasing and his future in the car business. The auto dealer has a number of paths which he can follow. They are: affiliate with a national system "even at some sacrifice of control over profits"; join a group of dealers of various makes; strike out as an independent; or ignore leasing altogether.

"The dealer's future position in the vehicle market may depend on his finding the one best answer," Larkin said. "The dealer in a leasing market must either enter it or resign himself to the possibility of losing sales to other dealers and other makes."

Larkin pointed out that if an auto dealer keeps out of leasing except to sell vehicles to rental or leasing fleets, "he may soon find himself at a dis­advantage in bidding for their business."

"The purchaser naturally favors those sources for cars and trucks which support his own arrange­ments for maintenance, resale and national adver­tising," he explained.

Naturally, Ford's intention with FALS is to in­crease its car sales.

In mid-1958, the Ford division established a new leasing department in the general sales office, with a leasing manager in each of the seven sales regions and a leasing representative in each sales district. The leasing department began with a goal of 300 Ford dealers in the Ford Authorized Leasing System. Currently there are 235 dealers with a combined fleet of 92,300 vehicles, Larkin said.

According to Larkin, the FALS system offers Ford dealers a "unique way" of combining the volume advantages of national affiliation with the profit advantages of independent operation.

"It enables the Ford dealer to regain sales that are maybe moving elsewhere at low profit and to realize additional profit by expanding his normal dealership operations," Larkin said.

While Larkin didn't say it, FALS also offers Ford an opportunity to cut into Chevrolet's edge in leasing and rental sales.