When it comes to average customers, there can be many advantages to buying instead of leasing a vehicle. But when it comes to a business vehicle, leasing is usually a no-brainer. Buying a vehicle for your business can quickly become a liability and there are many reasons why car ownership is just a bad decision for business owners. Let’s take a look at some of the reasons why leasing a vehicle is much more advantageous for businesses.
You Avoid Depreciation
Depreciation is one of the worst things about buying a new vehicle, and some vehicles can lose close to half of their value as soon as they leave the dealership. So, this is already an automatic loss if you bought the vehicle outright or through financing. Buying a brand-new vehicle makes absolutely no sense for a business, but leasing is a great way to get a new vehicle without having to deal with depreciation.
Also, the more your people will use the car, the more mileage they will start to accumulate. This will eventually also have an effect on the value of the car. If you lease the car, you won’t have to worry about this, as you can just switch to another new vehicle once the leasing agreement is over.
And depreciation isn’t fixed either. Some vehicles can lose a lot more of their value than expected, whether because of recalls, poor market conditions, abundant inventories, new vehicles, or a lack of interest in the vehicle. That’s one less thing to worry about when leasing.
Helps you Cut Costs
Financing a vehicle can get very expensive, and the monthly payments on a financing agreement will be much higher than on a lease. This is especially true if you’re looking for a luxury vehicle.
But with a lease, all you have to worry about is making an initial payment and much smaller monthly payments. And if you’re on the market for a luxury vehicle, like a BMW, for instance, then this makes even more sense. There are plenty of companies like Vantage Leasing that have special rates for businesses who are looking to get a BMW lease. Prestige vehicles will end up costing a fraction of what you’d have to pay through financing. They also have a wide selection of vehicles to choose from, to suit various budgets.
Leasing a car could also allow you to get some tax benefits as well. Depending on the vehicle’s gas emissions and how you intend to use it, you might be able to reclaim some of the Value Added Tax on the vehicle. And if you’re intending to use the car solely for business purposes, VAT could be removed completely.
Spend Less on Maintenance
When you lease a new vehicle, you’ll be able to save on maintenance in many ways. First, since the vehicle is brand new, you’ll have to worry less about wear and tear. Also, since the vehicle is under warranty, you are more likely to pay less on major repairs. Things like oil changes and basic maintenance will often be included in the lease as well.
As you can see, there is really no reason to buy when you’re looking for a corporate vehicle. Leasing allows you to avoid many headaches, gives you more flexibility, and makes more sense financially in the long run.