People often lease vehicles and equipment because they think it’s their only option. The outright cost of ownership is too much, so business owners feel like they have to “settle” for a lease. It doesn’t take long for these lessees to realize how much their companies actually benefit from leasing commercial vehicles. You may think you’re only breaking a large sum into manageable monthly installments, when you’re actually saving yourself thousands of dollars in maintenance fees while allowing your company to stay flexible.
Cut Repair Costs
When your livelihood depends on your vehicles being operational, you have no choice but to fix problems as they arise. Far too often, these unexpected expenses force business owners to borrow money in order to keep their fleets on the road. Leasing commercial vehicles eliminates this issue, as the leasing company is responsible for the maintenance. If the owner of the equipment gets to claim the depreciation of these assets, they also get to take care of any necessary repairs.
If you still think ownership would be more cost effective in the long run, consider how much a new radiator or new ball joints cost. These are commonly replaced parts, especially in vehicles that are driven for long hours on a daily basis. It doesn’t take long for repair costs to add up, and if you have the misfortune of needing to replace an entire engine, you might find yourself unable to cover other monthly expenses. These unpredictable bills are hard to budget for, while leasing commercial vehicles allows you to know exactly what you’re paying each month.
Get Better Vehicles
Imagine that you could afford to buy a commercial truck outright, paying the full amount in cash. There will be some repair costs that come up, but you’ll avoid monthly payments for quite a while. The problem is that in a few short years, there will be a better model that allows competing businesses to do work more efficiently than you. At that point you might find yourself wishing you’d spent your money on monthly lease payments, which allow you to upgrade at the end of the terms, or even during your lease if there’s an improvement clause. It’s important to remember that heavy equipment doesn’t last forever.
While it’s nice to have the control that comes with ownership, it’s sometimes nicer to have the flexibility that comes with a lease. Combine the option to upgrade with the money saved on repair costs, and the advantages of leasing commercial vehicles become very apparent.