Fleet News

Look at finance leasing, large fleets urged

FLEETS of 100-plus vehicles should consider moving away from contract hire in order to cut costs, according to Fleet Cost Management. Responding to the BVRLA's latest statistical survey - which showed 28% of contract hire companies are making profits of more than £1,000 per vehicle while a further 48% were earning between £500 and £1,000 - FCM urged fleet managers to take a close look at cheaper acquisition methods such as finance leasing.

Manager of corporate sales Simon Haggart said: 'For fleets of more than 100 vehicles it makes little sense to pay large amounts to cover the risk element of contract hire simply because there are many alternative acquisition methods available to them which avoid the risk element. The fact is that a large part of the profits being posted by contract hire companies can be translated into savings for most fleets by changing to an alternative acquisition method.'

FCM claims its own recent research has revealed that around £140,000 is being lost by the average 200-vehicle contract hired fleet over three years. It says that over a typical three-year cycle such a fleet would spend an extra £180 in maintenance and lose £500 in residuals per vehicle, compared to if they used a finance leasing product.

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