Historically vehicle repayment schemes
were fairly straightforward, with
transport operators paying a monthly
repayment for a predetermined number
of months. At the end of that period, you
owned the vehicle outright.
For transport operators to remain
competitive in the current economic
and political environment, they need to
review and evaluate the various vehicle
financing options currently available to
fleets and operators of all sizes. Due to
the changing circumstances, the best
method of paying for a vehicle a few
years ago is not necessarily the best
one now, and vehicles are increasingly
being seen as bad investments by astute
financial experts.
New vehicles and trailers are expen-
sive, coupled with continuing increases
in interest rates, while wear and tear
due to drivers and the deteriorating
road network result in rapid deprecia-
tion and the need to invest additional
capital when the time comes to replace
assets.
Vehicle financing options have
evolved drastically in the last few years,
and there are now a wide variety of
options to suit every need and pock-
et. When considering buying a new
vehicle, it is important to research all
the options available to you holistically
by considering all aspects, including
the interest rate, loan period, monthly
payment as well as the total cost of the
finance agreement across the contract
term to ensure that you are getting the
right solution for your needs and usage
requirements.
One option that has grown in popu-
larity in recent years as South Africans
forego the desire to own vehicles is
leasing and full-maintenance leases. This
sees operators pay one amount for the
use of the vehicle, with other monthly
costs such as insurance and mainte-
nance included.
“A full maintenance lease or a full
maintenance rental provides a com-
prehensive finance and maintenance
package for businesses and private
BUSINESS
‘Full maintenance leases
are a cost-effective
way for operators and
business owners to
acquire the vehicles
they need to run their
business and utilise
them by paying a
once-off monthly fee.
They will have the
use of the vehicle in a
hassle-free manner at
a much lower rate.’
Why leasing is becoming a
viable alternative for businesses
BUSINESS FLEET AFRICA | June 2023
WWW.BUSINESSFLEETAFRICA.CO.ZA