Earlier this month, Greg Dolson, general sales manager at Steele Chrysler in Halifax, did something that for him happens even more infrequently than his city's twice-a-month garbage collection. He leased a vehicle.

In this case, it was a Dodge Ram 1500 SXT quad cab pickup truck with a V8 Hemi engine. The customer was a business looking for the tax advantage that leasing offers, Mr. Dolson said.

Until this past July, the dealership was processing about seven lease deals a week. Now it does almost none.

"Sixty-two percent of our business was lease and that business overnight has evaporated," Mr. Dolson said in an interview on Friday. "We've really had to rethink what we're doing and how we're doing it."

Like Steele Chrysler, hundreds of Canada's automobile dealers are undergoing a profound change in how they're selling cars and trucks. It all stems from a decision in July by the financing arms of Chrysler LLC and General Motors Corp. in particular to pull back on the subsidized lease rates they've been offering for years. Credit-market pressures and declining residual values for vehicles have made leasing less economical. So Chrysler and GM are telling their dealers to steer customers to financing or cash transactions instead.

Continued at Financial Post