Companies are attracted by
flexible leases as economy remains uncertain.
Go deeper with GlobalData
Short-term leases are gaining in
popularity as companies opt to pay a premium in return for
flexibility in an uncertain economy.
PoolFleet, the short-term lease service operated by ALD Automotive,
is to add light commercial vehicles to its offer as the product’s
popularity continues to grow.
PoolFleet operations manager Adrian
Temple said: “Some customers require additional light commercial
vehicles for specific short-term contracts, or are reluctant to
commit to a long-term lease arrangement, or buy a vehicle
themselves, until they are more certain that business levels will
remain high as the economy recovers.”
PoolFleet is adding 115 new
Volkswagen vans, split between Caddys, Transporters and Crafters,
having increased its average number of live car rentals from 700
last year to more than 900 in the first half of 2010.
Other short-term lease providers
include Arval, Pendragon Contracts and Equalease, a
Manchester-based company that has carved out a niche in short- and
medium-term leasing. Equalease reports a growing number of fleets
renewing their lease every three to six months, with customers
paying an additional 20% to 25% monthly in return for
flexibility.
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By GlobalDataPaul Ashton, director of Equalease,
said: “Many businesses remain very wary about what the short- to
medium-term future may hold and especially the threat of a
double-dip recession. They do not want to enter into a three- or
four-year lease or to buy a new vehicle at a point in time while
they are unsure about the economy.”
Short-term lease vehicles also
maintain a strong residual value.
Temple said: “A combination of
circumstances including long lead times for new models and a
shortage of high quality nearly-new vehicles means that dealers are
prepared to pay above guide prices for ex-PoolFleet cars to satisfy
consumer demand.”
Resale values for models such as VW Passat and VW Golf have
averaged between £500 and £800 above CAP for ALD Automotive.
