When considering a company vehicle, owners may consider leasing the car rather than buying it outright. Buying a vehicle outright can be a costly venture, and has the potential to become a failed investment. Leasing a company vehicle offers a number of advantages over buying one, yet considerations should be made, as there are also disadvantages.
Leasing a company car will initially cost less money than purchasing a vehicle. While it varies for each dealership, outright buying a vehicle will typically require a down payment, while leasing a vehicle will usually require a security deposit, and one month payment in advance. Buyers should consider that the price for each can vary, but generally a lease agreement will require less money up-front.
When leasing a vehicle, it might be a requirement for it to be regularly maintained and serviced, or it might be an option offered at an extra cost. This makes using a leased vehicle a potentially far more reliable experience than owning one, resulting in less potential for break-downs and accidents.
Leasing a company vehicle allow for more flexibility when choosing another vehicle. When the lease agreement is finished, the vehicle is simply returned to the dealership, where buyers can opt to lease out another vehicle. When leasing a vehicle, the depreciation value of the car is of no importance, while someone who directly owns a vehicle will lose considerable profit.
Leased vehicles come with more restrictions as opposed to directly owning vehicles. Leased vehicles usually will have a mileage requirement, and can result in increased costs if the limit has been breached. For buyers looking to personally use a company vehicle rather than employees, consider that directly using the leased vehicle means you will have direct control over the mileage, while an employee might be more liberal with their use.
For companies that need vehicles for routes that do not change, a leased vehicle should not be a problem, but those with less assured routes might find it difficult to keep under the mileage limit. Buyers must also consider the potential for damage, as with a leased vehicle you are expected to pay for and repair any damage done to the vehicle.
Those interested in leasing a vehicle should consider the length of time they intend to use it for. If using the vehicle for a short amount of time, then leasing a vehicle would be ideal. If planning to use a vehicle for an extended period of time, it might be better to consider purchasing the vehicle outright.
Those interested in obtaining a company vehicle should consider their companies circumstances, the intended driver, the amount of time intended to use the vehicle, and the potential for damage and degradation in regards to the vehicle. Company vehicle leases are a great option for those unsure about the vehicle they want, and ideal for those who have limited available funds.Share