Mobility is a key need in many businesses. The requirement for a fleet of vehicles satisfies that need, but also requires a company to commit to vehicle fleet management, from purchase to eventual sale. Leasing, sometimes known as contract hire, is an excellent way to carve away the higher costs of owning your own vehicles while maintaining your company’s mobility.

In the past, corporations had to purchase, maintain, and sell their own company vehicles. Though the companies had an absolute requirement for these vehicles, the expense associated with fleet management was often quite high. Over the years, contract hire has become an attractive alternative, with companies merely leasing vehicles through agencies who manage the fleets for the hiring companies. In that scenario, while a company pays to use the vehicles, the overall cost comes down, and the company only pays a contracted monthly fee. This cuts out the unpredictable nature of owning vehicles and ensures, through contract, that the leasing owner assumes all vehicle responsibility previously held by the company.

An excellent aspect of contract hire is, of course, how fleet management can be accomplished without the company having to concern themselves with associated details and unpredictable costs. Many agencies who lease vehicles to corporations offer specific fleet management tools, such as periodic maintenance and offering to re-sell older vehicles. In the corporate world, predictable costs are desirable; unpredictable costs are simply not acceptable. With a contract hire fleet of vehicles, your company tailors its fees with a leasing agency, and knows almost precisely what its vehicle costs will be month-to-month.

Contract hire of vehicles literally strips away certain company costs. You still pay, of course, to lease but you now have the mobility you require with a fleet of vehicles that the leasing company manages. They make sure your company’s fleet runs well. If you select one of the various fleet management programs, they ensure a defective vehicle is repaired. The cost cutting element continues, as companies can now free up personnel requirements in maintenance and can instead hire more operations-oriented individuals.

Obviously, when a company uses contract hire vehicles, all associated paperwork, financing, and direct negotiations with dealers goes away. The company explains their needs and requirements to the leasing agency, who then does all the associated foot work required to obtain a vehicle. On the other side of this, when a company needs to either upgrade a leased vehicle or sell one outright, the leasing agency takes care of the details. Contract hire literally strips away the company’s burdens associated with buying and selling vehicles.
Leasing company vehicles through contract has clearly become the standard in any prominent corporation. Doing so lessens the need for fleet management, to include maintenance (when contracted), buying, selling and servicing vehicles. It also allows the company to better manage monthly overhead costs, since it now knows exactly what the fleet will cost. The overall result is that the company maintains its desire to be highly mobile, while still cutting some costs associated with managing its own fleet.

You can see more information by visiting our website, where we discuss both contract hire http://www.aldautomotive.co.uk/corporate/funding-solutions/contract-hire.aspx of vehicles and fleet management http://www.aldautomotive.com/products-services/fleet-management.aspx .