During his first quarterly conference call as chief economist at Cox Automotive, Jonathan Smoke chuckled for a moment when an investment analyst from Goldman Sachs asked about the rate consumers are keeping the vehicles they had just spent anywhere from 24 to 36 months leasing.

“Thanks for asking the most difficult thing to quantify in the entire marketplace,” Smoke said during the call on July 10. “We wish we had a precise number because it clearly has an impact on what we see at auction and what we see with the pricing dynamics.”

While not offering a specific figure, Smoke did add: “We think the grounding rate with the consumer taking the vehicle has been really low and trending lower.”

Earlier this year when Tom Webb still was leading the economic analysis unit at Cox Automotive, he mentioned the return rate — a vehicle not bought by the grounding dealer nor by the lessee — was currently running at about 50 percent to 55 percent. Webb emphasized that level is much lower than back in 2002 when return rates soared past 80 percent as many commercial banks got into the leasing game and the remarketing industry was still evolving.

While there is little doubt more off-lease vehicles are in the lanes nowadays, Smoke insisted the rise didn’t come as a “tidal wave.” Volume within this category rose late last year and during the early part of this year.

“Many people have characterized the off-lease impact as a tidal wave. Basically the biggest part of that tidal wave was the amount of increase that was going to hit the market in 2017. What we think has occurred was more of that increase fell in roughly a three- to four-month period at the end of 2016 and beginning of 2017. That’s not to say we aren’t seeing good numbers.

“We’re continuing to see them, but it’s at a pace that the market can handle,” Smoke added. “More so because we saw a marked increase in CPO sales. The retail demand is shaping up to take care of those vehicles.”

And with off-lease helping the cause, Smoke is projecting that overall used-car sales should climb about 2 percent year-over-year once 2017 comes to a close. He also touched on how the price gap between new cars and used vehicles — especially certified models that’s likely off-lease units —is outpacing inflation by a significant margin.

“People in the past who might have purchased new vehicles and might be coming off of lease now are considering a CPO vehicle,” Smoke said. “When you look at the financing options, it’s now more attractive than the lease payments. Anecdotally, we’re hearing that from a lot of franchised dealers. They’re happy to get the traffic to the lot, and they’re equally happy to be selling CPO vehicles because they can make more money. In fact, many manufacturers are incentivizing dealers to sell those CPO vehicles.

“That’s part of why you haven’t seen a collapse in used-car values,” he went on to say.

While Edmunds pointed out that overall leasing activity is off by about 4.4 percent during the first half of this year, several captive financial companies are booking leasing at strong paces. For example, General Motors Financial reported that its second-quarter leasing originations totaled $6.7 billion, higher than both the sequential and year-over-year comparisons.

When highlighting the lease segment of its business, GM Financial president and chief executive officer Dan Berce noted, “We now have over 1.4 million contracts with a balance of $37.4 billion, 95 percent of the lease portfolio had a FICO score at origination greater than 620 and 99 percent of our operating leases in the U.S. are current with respect to payment status.”