Many New Zealand companies prefer to lease company vehicles rather than purchase, as this offers many benefits when compared to regular asset acquisition. In this short article, we take a closer look at the pros and cons of commercial vehicle leasing, with the aim of helping you to make informed decisions.
Flexible Leasing Solutions
One size definitely does not fit all when it comes to New Zealand car leasing for companies; rather, you need a flexible and scalable solution that best meets the needs of your organisation. There are numerous leasing models, which we outline below.
- Operating Lease – An operating lease puts all your transport expenses into one affordable monthly payment. This keeps the vehicles off your books, and at the end of the lease, the vehicles are returned to the leasing company. The monthly cost includes vehicle maintenance, servicing, registration and insurance. This type of leasing is ideal for businesses that need to free up capital for other purposes and also to remain flexible.
- Finance Lease – This lease option allows a company to use vehicles without having to outlay the capital that ownership involves. The lease company purchases the vehicles on your behalf, and you pay fixed monthly payments. And when the lease expires, you have several options. You can purchase the vehicle with a single balloon payment, trade it in for a new vehicle, or refinance the residual value and carry on leasing. This option is good for companies that are looking for tax concessions or no deposit terms. Click here to find out about cybersecurity and why it is essential for every business.
- Sale & Leaseback – If you already own a fleet of vehicles, you can resell them to a leasing company and use the capital for other purposes. The leasing company leases the vehicles back to you using a structured agreement. An option for a business that needs additional capital by liquidating New Zealand car leasing the capital tied up in the fleet. You also have fleet management included in the agreement.
Professional Advice
Leasing offers numerous options, and the best way to make an informed decision is to approach a leading New Zealand vehicle leasing specialist and let the experts guide you to the right option. There are tax concessions to take into account, and each leasing option has its own pros and cons.
Setting Up a New Business
If you are planning to set up a small business and you need commercial vehicles, but do not have the capital for outright purchase, leasing is the perfect alternative. For some small operations, this is the only way to obtain the vehicle they need in order to carry out the work.
Business Expansion
In the event a business needs additional vehicles and they have limited capital, leasing is a good alternative. If you would like to learn more about vehicle leasing, talk to the experts and let them guide you to the right solution.
