Fleet leasing is when a company leases a number of vehicles for their employees to use. This can be for business only vehicles or to use in their company car schemes.
Leasing is becoming an increasingly popular choice for businesses as it offers employees the opportunity to drive a new model every few years and comes with a whole range of financial benefits for the company.
There are a number of reasons that you might decide leasing is the best option for your company’s fleet.
These include:
There are many benefits to leasing a vehicle but there are a number of other factors that you will want to consider when deciding if leasing is right for your fleet.
A lease vehicle will need to be returned at the end of the lease and if its condition is not in line with the BVRLA’s fair wear and tear guidelines then there may be a charge.
A lease has a set contractual mileage allowance and if the vehicle is returned with more miles on the clock than expected there will also be a charge for this. If you realise partway through the contract that you are likely to go over the contracted mileage on a particular vehicle you can request a quote for amending the mileage allowance but this would also change the monthly rental cost as well.
If you opt for non-maintained leases, then it would be the business’ responsibility to maintain and service each vehicle in line with the manufacturer and funder’s guidelines.
If you have a large fleet of vehicles for your business then it can be quite time consuming to manage them so you might want to look at a fleet management service which can handle this for you.
There are a number of different options that you can choose from to supply your fleet vehicles.
The main two leasing options for businesses are a contract hire agreement and a finance leasing agreement.
A contract hire agreement is a form of long-term rental where the business leases a vehicle for a set period of time with an agreed annual mileage.
This is the main type of business lease that Xcite Car Leasing can offer your business.
The vehicle will not show on your balance sheet as it is not an asset owned by the business.
Unlike with a contract hire agreement a finance lease has the option to purchase the vehicle at the end of the set contract.
The full cost of the vehicle, including interest charges, may be spread over the duration of the contract or you can choose to have lower monthly payments and one balloon payment at the end of the lease.
Vehicles under a finance lease may show on your balance sheet as an asset depending on the agreement.
An alternative to leasing for your fleet is outright purchase. This is where the business buys the vehicle, paying for it upfront.
With an outright purchase the vehicle shows as an asset on the balance books.
Owning the vehicle comes with different responsibilities to leasing. The business will be responsible for servicing and maintaining the vehicle, taxing it and ensuring the vehicle is fit for purpose.
If you no longer require the vehicle it will also be up to the business to sell, and depending on the condition and age the vehicle depreciation may mean the business loses money.
As part of a lease agreement you have the option to include a maintenance package.
Most packages cover servicing, maintenance work and MOTs that are needed for the duration of the lease.
They will usually also include repairing or replacing tyres.
The specifics of what is included in your maintenance package depends on the funder but if you would like a general overview of what is included before making your decision you can take a look at our car leasing maintenance guide.
With a maintenance package you will not need to worry about arranging any servicing or required maintenance as the funder will make all of the arrangements once you have contacted them, which is easy to do with their one-stop phone numbers.
You can even give the driver the contact number so they can discuss any servicing or maintenance requirements directly with the funder.
Depending on how large your fleet is you might want to look at a management service. This can take the stress out of having to manage new, returning and maintenance of vehicles for the business.
Each vehicle in your fleet will be on its own individual lease agreement. When you get to the end of a contract you will need to get in touch with us towards the end of the lease so that we can arrange collection for you by the end of your contract.
You can see our full guide on what to do at the end of your lease, or you can simply give us a call and we can go through the process over the phone with you.
Please note that the vehicle will need to be returned in a condition that is in line with the BVRLA’s fair wear and tear guidelines. This includes removing any signwriting that you may have applied to the car.
If you’re interested in fleet leasing then you can take a look at our guide to running a company car scheme or give us a call on 03302210000.
To begin with your fleet leasing deal, you’ll need to determine how many vehicles you’ll need, what your budget is, how long you’ll need the vehicles for, what your mileage limits will be and more. Once you have decided on these factors, you can contact us via our enquiry form or by giving us a call at 03302210000. We’ll be able to help you through your fleet leasing journey every step of the way.
When determining whether fleet leasing is right for your company, you’ll have to consider things like:
Leasing is often a great option for a business when they need a lot of vehicles for a set period of time via low and fixed monthly payments. It’s crucial that you analyse the specific needs of your business before coming to a decision on whether fleet leasing is right for you.
How many vehicles are needed to specifically call it a fleet varies depending on who you ask, but the general consensus is that a fleet is anything more than a couple of vehicles.
There are a few ways to save money when leasing a fleet. These include simple ways such as looking out for any special offers and cheap deals, through to more practical things like choosing the right type of lease for you, and ensuring you get the right lease term. An easy way to save money and avoid any possible penalties is to work out your mileage figures as accurately as possible to avoid going over.
You can also save money as you go by managing your fleet effectively, such as tracking your company car’s mileage, maintaining your vehicles to a high standard, and ensuring all vehicles are driven safely.
When leasing cars for a fleet, there are various types of vehicles that are available to choose from. The best choice for you will depend on the needs of your business, with options including a variety of cars and vans, as well as some specialised vehicles such as food trucks and minibuses.
Check out one of our helpful guides or our explaination of leasing to get all your questions answered.
You can unsubscribe at any time
