Full-service leasing, contract maintenance, and managed maintenance services are all viable options for fleets considering which activities make more sense to outsource vs. doing in-house. Often times it simply comes down to whether a particular function or activity is core to your business and therefore justifies the allocation of capital and resources over other investment opportunities.
Many private fleets choose to outsource their fleet acquisition and maintenance requirements and full service leasing provides a compelling argument.
Here are some ways full-service leasing can benefit private fleets:
- Choosing the asset: You’ll receive guidance and assistance with selecting the optimal vehicle configuration for reliability and service; specs best suited for your particular application. You’ll also be able to leverage the purchasing power of your lessor and obtain better equipment pricing, from which the lease payment is derived. Additionally at the end of the lease, the lessor facilitates vehicle remarketing and disposal of the asset.
- Financing the asset: Since there is no initial cash outlay required, you can essentially expense 100% of the purchase price, while preserving capital for more core business investments. Notwithstanding normal inflation, you’ll also enjoy budget predictability over the term of the lease knowing exactly what the asset will cost each month for as long as you have it.
- Servicing the asset: A host of services are included with your lease including scheduled preventive maintenance, emergency roadside service, tire repairs and replacement, towing, licensing and permitting, fuel tax reporting, vehicle washing, replacement vehicles and safety programs.
- Technology requirements: Today’s trucks are increasingly tech-enabled, incorporating telematics and other IoT devices to provide the important data you need, and today’s lessor possesses the diagnostic tools and equipment, as well as trained technicians, to keep your vehicles in top operating condition. Given the rapid pace of vehicle technology innovation, full service leasing may also provide a hedge against technical obsolescence as lessors regularly replenish their rental fleets with the latest equipment, thus providing an opportunity for customers to rent and experience the benefits of such before making a long-term commitment.
Full-service leasing may not make sense for every situation, but for many private fleets it simplifies a big part of their transportation equation and allows them to concentrate on what's truly core to their business.