Should i buy a fleet lease vehicle

Especially if you have a pretty large team all doing different mileage. If any of the cars are returned with excess mileage then an additional fee is applied at the end of the lease contract. Many companies ask their drivers to report the mileage monthly or quarterly to keep an eye on it.

Ensuring the vehicle is returned in good working order is a necessity for a contract hire vehicle. You must keep up regular maintenance checks such as servicing, in order to be compliant with the lease.

If the lease car is returned with damage there would be additional fees to pay at the end of the lease term. Need advice from an experienced Vehicle Specialist on what vehicle is right for you? This site uses Akismet to reduce spam. Learn how your comment data is processed. This website stores cookies on your computer. These cookies are used to improve our website and provide more personalised services to you, both on this website and through other media.

To find out more about the cookies we use, see our Privacy Policy. Fleet leasing vs. Pros of buying a vehicle for a company While purchasing a fleet vehicle may seem expensive it does have some benefits.

Pros of leasing a fleet vehicle Leasing a fleet vehicle comes with a huge wealth of pros. Flexible Another benefit to leasing a fleet vehicle is the flexibility. There are significant tax benefits to contract hire. Did you know? Zero stress Leasing simply offers a zero stress approach to fleet cars. Fed up with looking for your next vehicle? Leasing When leasing, leave the fleet maintenance management headaches to your fleet management partner.

Costs are often lower and can be included in certain leasing tiers, sometimes at predictable fixed costs. Also, leasing newer vehicles reduces the amount of maintenance issues that otherwise fall on an older and aging fleet that you own. Purchasing If you purchase your fleet, you are in charge of the maintenance on your vehicles, which can cost you valuable time and money. However, you will not be held to strict timelines for maintenance or repairs and may have more flexibility when choosing where to take your vehicle for service.

Leasing When leasing from a reliable fleet management partner, you can benefit from a tailored selection of services, including:. With a leasing partner or fleet management company, you usually will have a project manager or team assigned to your account.

Purchasing If you do not have a fleet management partner and own your vehicles, you are responsible for the analysis of all fleet data. You will also need to manage your vehicle inventory, consolidate invoices and costs, and source insurance and other services to help keep your fleet running. Vehicle remarketing and replacement are part of a vehicle cycling strategy.

This is a plan that fleets put together that defines when vehicles should be replaced, and considers factors like mileage per year, optimal timing, and potential financial impacts. Leasing Fleet leasing was designed to provide set vehicle cycles.

Before signing a lease agreement, the terms will define how long you will have the vehicles, the residual value of the vehicles, and the return or purchase process. Your leasing partner or fleet management company will dispose of the vehicles for you and help you determine replacement options.

Purchasing Fleets that are financed or owned have undefined lifecycles, and you retain full control of the vehicles once you have the titles in hand. With this control, you must determine when, where, and how to dispose of the vehicles. You will also be responsible for pricing the vehicle. Fleet fuel cards offer rebates for the amount of money that companies spend, which can save costs.

Compared to using a company credit card that only shows the balance spent on fuel, there are far more detailed analytics that you can glean from each transaction. This information includes how many gallons, the price per gallon, the exact time and location of the purchase, and other data. This is all valuable information when evaluating overall fuel spend. In addition, a fuel card with a PIN management system can alert your company when there may have been a fraudulent purchase.

For example, if a fuel card was used in upstate New York at 12 p. Many leasing partners and fleet management companies offer fuel management and fuel card programs as part of their typical services, so leasing your vehicles may offer the advantage of keeping all operations under one roof.

However, if you own or finance your vehicles, you have the option of working directly with a fuel card provider or with a fleet management company for this service. Vehicles depreciate as mileage increases, whether the vehicle is leased or purchased. The difference is the up-front cost, which can be lower with manufacturer discounts and incentives gained from leasing.

Leasing Your monthly payments will also be much less if you lease. This is an affordable and efficient option for fleets because you can preserve capital and then reinvest the money you save into other areas of your business. The good news is that as vehicle owners you have more control over this number.

While leasing companies resell their vehicles in bulk, you can sell the vehicles individually and likely end up with lower net depreciation. Vehicles gain equity over time. You can then reinvest that positive equity back into your company. With leasing, any earned equity remains with the lessor. Try not to the let the options overwhelm you in your decision process.

Instead, establish fleet goals and needs and keep the following tips in mind:. Call us at or email hello fleetio. There are two main types of leases: Open-end leases: This type of leasing agreement starts with a minimum lease term usually one year then permits additional month-to-month leasing options at your preference. At the end of the leasing agreement, you may choose to sell the vehicles.

On the flip side, if the sale is less than the value of the assets, you are required to pay the difference to the lessor. Closed-end leases: This is a fixed term leasing agreement with fixed monthly payments. You cannot cause excess wear and tear on the vehicles or exceed a predetermined mileage limit.

If you do either of these things, you must pay a penalty. Preserve capital Leasing agreements have lower monthly payments than purchasing vehicles outright. Save on maintenance and fuel costs Leased vehicles enable you to visit the repair shop and gas pump less often. Off-balance sheet treatment Buying vehicles is a major capital expense that impacts your debt-to-equity ratio and makes your company appear less attractive to lenders or investors.

Flexibility for vehicle replacement How often do you typically replace your fleet vehicles? Less administration Did someone say less paperwork? Newer vehicles Leased vehicles are usually new vehicle models—several benefits come with this such as the latest vehicle technologies and safety features, fewer maintenance issues and better fuel economy.

In customer facing industries, newer vehicles can portray an image of success. Leasing sounds pretty solid, huh? About the Author. Ready to get started? Join thousands of fleets running on Fleetio Questions? You might also like. Fleetio Announces Integration with Idelic. Fleetio Announces Integration with ClearQuote. Streamline Fleet Workflows with Outsourced Maintenance Automation fleet maintenance outsourced maintenance automation shop integration maintenance shop directory fleetio manage.