Like many others, the car industry has been hit hard by the pandemic, and there are a number of lasting impacts that Covid-19 will have on both the car industry as a whole and the leasing sector in particular.


Spencer Blake, Director at Wessex Fleet and former Chairman of the BVRLA Leasing Broker Committee said: “The leasing and rental industry was hugely affected by the pandemic and lockdown periods in the UK and abroad. Now we’re easing out of lockdown we are starting to see the long term effects it’s having across the sector as well as the obvious short term ones.

“At Xcite Car Leasing we saw the initial impact hit both our new and existing customers. A lack of consumer confidence in the market based on uncertainties in the economy and concerns over individual job security meant that the number of new enquires we received into the business slowed right down. It also meant that existing lease customers needed to explore their options with payment breaks and early returns of their lease vehicles. 

“The UK lockdown meant that vehicles were unable to move, both shipping new cars into the UK for delivery and collecting vehicles that were at the end of their lease. We’re seeing vehicles movements now and dealers have been open for a little while so deliveries are going out to customers, albeit with some changes to ensure everyone’s safety. Across the industry, we’re seeing cars moving quickly now as manufacturers are working hard to get them out and onto the road as quickly as possible.

“Collections have been taking longer than before with the lockdown backlog, but we are also seeing this gradually come down, with some companies back at their pre-lockdown lead time already.

“As the economy has started to recover, we’ve seen the leasing sector start to bounce back as well, with the number of enquiries on the rise. However, we’re still seeing the long-term impact of the pandemic. Lockdowns around the world mean that a lot of factories were closed for extended periods, with those in China shutting as early as February. This means that there’s going to be a backlog of orders which has a knock-on effect on how quickly we can source a car.

“When you consider that not only have they got to produce the vehicles that were due to be built during the closures, as well as new orders, and the new guidelines and process changes that have had to be made to accommodate social distancing we’re probably going to see this having an impact on lead times of new vehicles until at least the end of the year at least.

“In terms of getting funding in place there have been some changes, and we’re bound to see more as we get a clearer idea of what’s going to happen with the UK economy as a whole.

“Funders, understandably, don’t want to approve an application when the customer’s likely to have a change in circumstances due to the pandemic and a new lease could cause additional financial stress for them.

“At the minute we’re seeing all funders looking at applications more thoroughly, which means they sometimes ask us to get additional information from our customers, and the process as a whole is taking longer than usual. I think this is likely to be one of the permanent changes we see in the industry as a result of Covid-19.

“Although as a business we’ve been open for the duration of the pandemic all our staff have been working remotely from home until the last couple of weeks. To ensure our staff’s safety now that we are reopening the office, we are following the government’s guidelines on social distancing and shared spaces. We’re also working with each member of the team individually, offering flexibility with working in the office and at home over the next few months.

“Under normal circumstances, our office would usually be open to the public, but to minimise the risk to our staff and customer’s we have taken the additional step of having no visitors in the office for the remainder of the year. We will of course still be available on the phones and over email to help answer any questions and are even opening later than before with at least one of our leasing consultants in until 8pm.

“I’m hopeful that we’ve now seen the worst of Covid-19 and its impact on the sector and our business, in terms of the decline in consumer confidence and vehicle availability but I do think that there are going to be long reaching impacts that the industry is going to have to adapt to.”

Overall, it’s clear that Covid-19 has had a massive impact on the car industry in general but what does this mean for leasing and how might you be impacted if you’re in a lease or about to lease a vehicle? We’ve taken a look at both of these circumstances and the options available for you.

Current Car Leases and Covid-19:

If you currently have a lease vehicle, you might be thinking about how the pandemic has affected your lease be it your mileage, returning the vehicle early or taking a payment break. To help we’ve explored all of these options for you below.

Amending Your Lease:

There are a number of ways that you might decide to amend your existing lease because of the pandemic. These include:

  • Amending your mileage allowance
  • Extending your lease
  • Ending the lease early

Amending Your Mileage Allowance:

We’ve seen a lot of customers who haven’t done the mileage they expected to do because of the lockdown and as a result have asked about reducing their mileage.

We recently wrote about amending your mileage and looked at the minimum annual mileage our funders would allow. The funders that we work with offer a minimum mileage of between 5,000 and 10,000 miles annually so if your contracted mileage is already at this amount then you may not be able to able to reduce the mileage any further depending on the funder.

Reducing your mileage allowance can also have an impact on the monthly payments you make, and you will need to agree to any quote provided, usually by signing the document, before these changes are confirmed.

Please note that almost all funders will need you to have had the vehicle for at least 12 months in order to amend the mileage. This is because they like to have an accurate estimate of your annual mileage to reduce the need for further amendments later in the contract.

Extending Your Lease:

A lot of leasing customers are seeing delays to their new lease vehicles and so are deciding to extend their current lease.

There are two types of extensions: formal and informal.

Formal extensions are usually for six or 12 months and involve signing a new contract with agreed mileage and end date. If you have a lease through us, we can request a quote for this with your funder for you.  

Informal extensions are when you do not have a contract to agree on the extension but keep the vehicle and make monthly payments until it is returned. This does mean that the lease company may ask for the car to be returned at any time though. 

It’s important to be aware that these monthly payments may be different to those that you were making while in the original contracted lease as they will not take into account the initial rental payment you made as part of the lease agreement.

If you do decide to go into an informal extension, the payments will be made in arrears. As lease payments are made in advance which means that there will be a larger gap than usual in payments when you go into the extension as contracted lease payments are usually made in advance.

Please give us a call on 0330 221 0000 if you have leased a vehicle through us and have any questions about either an informal or formal extension on your lease.

Ending Your Lease Early:  

 Another option that we’ve seen more customers exploring is ending their lease earlier than the contractual end date.

This is done through an early termination. The funder will usually request the current mileage and then be able to provide you with a quote for ending the lease early. If you have a lease that we arranged, we can usually request this quote on your behalf.

You will need to sign and return the quote before the expiry date and this will need to be accepted by the funder before we can then arrange collection for you. Please note that some funders will ask for the collection details to be included on the early termination form.

If you are unable to afford the early termination cost, you will need to speak to the funder directly to discuss your options.

Collection of Your Lease Vehicle:

Lockdown across the country has not only affected the delivery of new vehicles but also the return of current vehicles. Collections that had been arranged were cancelled during the lockdown period and rescheduled. This, along with the drivers whose lease was due to end during the lockdown, has meant the lead time for collections is currently much longer than usual, with some lead times moving from two weeks to a month.

Some funders are using additional carriers or have amended the inspection and collection process so that these happen separately, with the inspection agent arranging collection for a couple of days later.

If your lease is through us, we advise that you get in touch as soon as you know when you want your lease vehicle collected so we can arrange this for as close to your preferred date as possible.  You can contact our Support Team on 01733 322 888 or a href=“”> to arrange collection.

Similar to the delivery of new leases collections are now being adapted to be as contactless as possible though you may still be required to sign or e-sign to agree to the inspection report.

Payment Breaks:

All of our funders are working with their customers to help ease the financial strain during this difficult time.

The Financial Conduct Authority (FCA) issued guidance on three month payment breaks for all vehicle lease customers.

The schemes on offer vary between funder but include:

  • Payment breaks and holidays
  • Reduced payments and payment plans

If you would like to explore what options are available to you, you will need to speak to your funder directly. We can direct you to the correct department and provide their contact details if you need them.

Other Things to Consider on Your Current Lease:

  • MOTS
  • Servicing
  • Company Car Tax

Although the government had an MOT break during lockdown this is now over. Vehicles that were due to have an MOT between the dates of 30th March and 31st of July will still have a six month extension in place but if your MOT was due outside of these dates then it will need to be completed by the original deadline in order to drive the vehicle.

If you have a lease that is for less than three years, then you will not need to MOT the vehicle as this is first due three years from the first registration date. If you’re unsure whether your vehicle requires an MOT please speak to our Customer Services Team on 0330 221 0000 or

During the pandemic our funders have been understanding about servicing, as lockdown has meant garages were closed or only working on the most urgent of repairs. Now that garages are opening up again if your vehicle was due a service you were unable to arrange during lockdown, you will need to arrange this for as soon as possible.

 A lot of the country have been furloughed due to the pandemic, and if you have a company car, you may be wondering what impact this has on your company car tax. HMRC has provided a guide which should answer any questions you have on this.

New Car Leases: 

If you’re leasing or thinking of leasing your next car, we’ve also taken a look at how Covid-19 will affect this process for you.

Credit Approval:

Part of the application process for a lease involves getting financial approval from the funder.

At the minute this is now taking a little longer than usual as funders are dealing with a backlog due to reduced staffing and more thorough checks. Some are still working on the usual 48-hour turnaround time however others have advised that if not automatically approved the approval time can be 14 to 20 days. When submitting your application, we will advise you on how long the application approval can take with that particular funder.

As part of the process, we may need to double check details that you think of as unnecessary but this is to ensure that all details are correct and to avoid any unnecessary delays to the application once it has been submitted to the funder.

Delivery of a New Lease Vehicle:

The delivery process has also changed as a result of Covid-19, with most of our dealers now trying to have a contactless delivery process.

Sometimes this is not always possible, but the delivery drivers will do everything in their power to minimise contact between them and yourself.  

Because of the contactless deliveries you may not need to physically sign for the vehicle any more as part of the delivery process, however our funders still require confirmation that you have received the vehicle and so we may ask you to sign a handover note or send a confirmation email following delivery. Our Customer Services Team will let you know if this is required.

An additional step most funders are now taking is to only allow delivery to the address on the finance application. This means that if you are taking out a personal lease delivery, it will need to be delivered to you at home and cannot be delivered to your work address. Similarly, if the lease is a business one then delivery will need to be to a business address and cannot be to the driver’s home address. 

Xcite Car Leasing and Covid-19:

Here at Xcite Car Leasing we are working hard to minimise the impact that Covid-19 has for all our existing and new customers.

We have been open throughout the pandemic and as changes in the industry are happening, we’re doing our very best to keep all of our customers updated on anything that could affect their lease or order for a new lease.

We’re working with funders and making sure that when we submit any credit application, all the necessary information is included to avoid any delays in the application process, which is now taking a little longer.

With regards to the lead times on vehicles, we are working with dealerships to provide our existing customers with realistic updates on their vehicles and if they have been delayed due to the pandemic. We are also making sure that for new customers the lead time given on our website and when you first speak to one of our leasing consultants is as up to date as possible based on the information our dealers provide.

Xcite Car Leasing works with a wide range of dealerships across the country and we’re working with them all to source in stock vehicles for faster deliveries.

As mentioned above, if you have a current lease through us, we will help you with any queries or quotes you would like to request from the funder for extending, terminating early or modifying your agreement. All you need to do is get in touch with our Support Team on 0330 221 0000.

If you have any questions about a lease you have with us or even general leasing queries,  please give us a call on 0330 221 0000.


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