Lease Not Buy
These days half of all new cars bought in the UK are purchased by rental and leasing companies, so why do so many people lease instead of buy it? We caught up with Simon Carr of leaders in the field, LeasePlan Go, to explore the advantages to enjoy.
At glitzy ceremonies around the world the latest metal is revealed at International Motor Shows and the general rule of thumb is that a car is refreshed, or revamped, every four years, to introduce the latest and best new car innovations and technology. Shortly after, these vehicles hit the showrooms for sales to the public.
However, according to the British Vehicle and Rental Leasing Association (BVRLA), half of all new cars bought in the UK are by rental and leasing companies who lease out to personal and business leasing customers. It is a £14bn industry and comprises 2.75 million vehicles across the UK. So why do so many people lease not buy?
Simon Carr, Brand Director of LeasePlan Go, a part of the world’s largest leasing provider for business and personal use with over 1.3 million vehicles in its global fleet, says there is an answer: “It comes down to 2 reasons, convenience and risk. Leasing a vehicle is so easy, it comes with the support of an organisation dedicated to keeping you on the road, regardless of what happens. At LeasePlan Go, each vehicle comes with a 24/7, 365 phone number which will be answered by an expert totally dedicated to sorting out your problem. Another aspect of convenience is the payment profile, this can mean the payments are spread evenly across the period of the contract removing the need for big cash layouts – it’s like software as a service, only for cars. The risk factor is the second major reason. Most people are not experts in selling or valuing second hand cars. The market fluctuates in terms of the value of a vehicle so you may get less back than you thought, that is if you can find a buyer. Most people love the fact that it is not their problem even if there is a loss on the sale.”
“The 2 or 3 year cycle most common in leasing means you are never far away from an opportunity to drive the most exciting, most luxurious and most technologically-advanced cars on the road today. Leasing a car is about freedom of choice.”
Why is it relevant to you?
Everybody wants to drive the best car within their own individual price range and it is no surprise to see the premium saloons, coupes, SUVs and convertibles at the top of most drivers’ wish lists. In fact, cars such as the BMW 3 Series, Range Rover Evoque and Mercedes C-Class are so popular they are regulars in the top ten best-sellers list and on favourite leasing car tables. Then there are new entrants which are sure to create enormous demand such as the Tesla Model S.
Personal leasing customers are often people who like to change their vehicle regularly; they want competitive rates and those cars to be premium, modern, technologically-advanced cars that match their lifestyle. One of our most common situations is the replacement of a family vehicle. A new vehicle not only means affordable rates but with the peace of mind that you will be supported by an organisation that ensures they look after drivers in the event of an accident, breakdown or just during routine servicing.
Companies such as LeasePlan Go are best placed to advise drivers on which vehicles are best for their needs whether you are after efficiency, practicality or style they have access to vehicles from the world’s best manufacturers. All of their leasing deals are fixed rental price deals, which means the amount of administration and financial planning a driver needs is greatly reduced.
“Personal leasing cars is different to buying and it’s one of the areas where drivers of premium vehicles may not be aware of the benefits,” explains Carr,
Car leasing deals are worked out by taking the price of the vehicle from new and the expected value of the car at the end of the term. The depreciation is split across the number of months in the agreement, giving you the basis for your monthly payment, plus the cost of finance.
Carr says: “We offer our customers much more than just a vehicle to both personal and business customers; we provide a fully comprehensive package which includes a range of outstanding services, from unlimited maintenance, servicing and tyre packages, roadside assistance and a dedicated customer support team, each specifically designed to make our customers’ motoring experience a premium one. All of these services can be accessed through one dedicated driver line.”
“Book a service”, says Carr, “And a lease car customer will feel like they are getting a VIP treatment every time the car is brought in. We like to think of this as a car concierge service.”
Private leasing is available on a huge range of manufacturers but it really brings benefits when it comes to the higher end of the market. Luxury car makers including Porsche, Maseratti, Tesla and Range Rover can offer lower rates of depreciation and therefore the lease rates can be surprisingly affordable.
“With over 30 years in the UK vehicle leasing industry, LeasePlan Go has excellent relationships with many of the major car manufacturers and so we are able to negotiate industry leading discounts on the vehicles that we buy for our customers. These savings are passed straight on to you to reduce your monthly payments. It also means that we have 100’s of vehicles in stock at any one time, meaning faster deliveries on popular models,” concludes Carr.
It begs the question; in the world of premium cars, why buy when you can lease?