CU Xpress Opens Dealership in Hauppauge

Hauppauge-based CU Xpress Lease is reselling its leased vehicles to Long Island consumers for the first time at a new dealership center in Hauppauge Industrial Park.

The company's 50,000-square-foot facility, dubbed the Lease Return Resale Center, will hold about 400 vehicles for up to 60 days after their return date to give consumers a chance to purchase the low-mileage cars before they're ushered to auction.

From vehicles returned to the center by its clients, CU Xpress will choose cars that have had only one owner, have never been in an accident and have clean Carfax reports to put up for sale.

"We're trying to separate ourselves by selecting vehicles with extensive evaluation," said Joseph Coreno, director of remarking and operations at Dallas-based Fusion Auto Finance, which partnered with Hauppauge-based GrooveCar in 2007 to form CU Xpress. "We only want pristine cars here."

The center, which formerly housed City & Suburban, a New York Times distributor the paper closed in January 2009, will carry the Fusion name, though Coreno said the two companies are trying to give it its own brand as the LRRC.

The new venture presents opportunities to increase business for both companies in the CU Xpress partnership.

Financing at the center will be offered solely through credit union members of GrooveCar, increasing volume for the local company, and leased cars will be sold at retail value instead of the often-lower wholesale price garnered at auctions, a plus for Fusion.

Before the center was up and running, Fusion, which owns cars leased through CU Xpress once the lease period is up, would send all returned vehicles to auction. Coreno said selling the cars at retail value could mean up to $3,000 more per vehicle for the leasing company.

Jacobson, who is also the chief executive of GrooveCar, said the center offers big deals for Long Island consumers as well. Because the vehicles up for sale have had only one owner, some have as little as 3,000 miles on them and almost all are still under factory warranty.

"Off-lease cars are the most desirable used cars on the market," he added.

While the lease return center officially opened in June, Jacobson said cars weren't available to the public until a few weeks ago.

The two companies anticipate high demand for their new products and Coreno said he hopes at first the center will sell about 50 cars per month. Jacobson said they've already met that mark in the first two weeks of operation.

Inventory is constantly replenished, as the center gets new returned cars everyday, and Jacobson said he expects 300 to 500 leased cars to be returned each month. Cars that aren't sold during the 60-day period will be sent to auction.

To attract attention to its newest venture, the two companies are hosting weekend sales for specific credit union members. For example, on the weekend of Nov. 13, members of Teachers Federal Credit Union will get first dibs on the newest batch of returned cars along with coupons for up to $500 off the purchase price of vehicles.

"This center is very unique," Jacobson said. "This is going to be a real inside industry opportunity for consumers to buy these vehicles."