When a leased car is turned into a dealership, the dealership has a crack at buying it from the leasing company. Sometimes the car is passed on for reasons of condition; sometimes the car is passed on for non-condition reasons, such as unpopularity or an uncompetitive purchase price as compared to resale value. In those cases, the car is sold at auction, establishing its sales price, which the leasing company can use to establish a taxable loss (as compared to the residual value established at the beginning of the lease). My 2014 Ford Taurus SHO was leased through Ford, and even though it had reasonable mileage, in very good condition, and in a popular color, the dealer passed on buying it from Ford, as similar cars were being sold more cheaply at auction. My point is that not all cars are on the auction block because of condition issues.