Fleet News

Fleet Management Live: "Businesses need to consider all options before agreeing on funding strategy," warns Lex Autolease

Richard Tilden, head of commercial vehicles, Lex Autolease, advised businesses to consider all options before agreeing on a funding strategy at last month's Fleet Management Live. 

Funding methods for commercial vehicles predominantly focus on contract hire versus purchase.

Businesses need to consider all available options before agreeing on a funding strategy to ensure their fleet is cost-effective in the long-term.

Richard Tilden reviewed the full range of funding choices available to fleets and outlined how upcoming lease accounting changes could impact their choice.

“The industry has been talking about these changes for years. They primarily affect those customers who are property driven,” he said. 

“But vehicles will have an impact. Businesses need to have a conversation with their bank to make sure they know how their future borrowing could be affected.”

Moving to a flexible rental model is one possible way to keep vehicles off balance sheet, he suggested. 

But Tilden warned: “If that customer always has that product then it goes on balance sheet. You can’t avoid something, the basic rule is: If it looks like a duck and quacks like a duck it probably is a duck.”

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