Car leasing for business purposes is getting more popular because of the convenience. Car leasing saves a lot of money that might spend on buying a new vehicle. Leasing business is more of a traditional approach to acquiring a vehicle where you don’t need to go any bank for finance. People book a vehicle for a long duration until they need it and pay the rent as per the condition provided by a car leasing company.
Here are a few mandatory situations which are required in a car leasing business:
- Duration:Leasing works well to those who buy a vehicle on rent for a short duration. It is good to buy a vehicle for business purposes for 2-3 years. In a short duration, you need to pay small monthly instalments.
- Taxes: Insurance cost, servicing cost, maintenance, and other important costs other cost related to vehicles are exempted in vehicle leasing. Leasing a vehicle have a lot of advantages in tax saving.
- Maintenance, Repair, and Insurance: When someone owns a vehicle then maintenance, repair, and insurance are consider as mandatory things. Car insurance is needed to renew after a specific duration. Same goes with the maintenance. If you are using the vehicle on lease, then all the necessary things take care by the service provider. You can use the vehicle properly and concentrate on your business. Considering these entire facilities, car leasing companies in India are increasing continuously.
- Ownership: When you select to buy a vehicle on lease, then it comes with some terms and condition. Millage is one of the important conditions. A leasing company issues a car with some definite millage. User has to manage to use the vehicle for definite millage only. In case the limit is exceeding, then the proper agreement is required from the service provider company.
Some leasing terminologies are important to know:
- Capitalized cost: This is the cost of the vehicle decided by the manufacturer or the owner of a car leasing company. This cost is negotiable.
- Capital cost reduction: This refers to down payment cost. Capital cost reduction applies to those who wish to buy the vehicle at the end of the lease.
- Residual value: This is related to the price calculated at the end of the lease. The residual value depends on the capitalized cost of the vehicle. Most car leasing companies maintained a databased related to the capitalized cost and residual value of all the vehicles.
Car leasing companies in India are growing because of the amazing features this business hold. Especially, business companies have a high demand for the vehicle on lease. Corporates are getting benefited more due to the availability of vehicles as per their need.
Vehicle leasing is considered as a boon for corporates. It carries all the burden related to the vehicle and allows the business person to use the vehicles to improve their work efficiency. Also, it helps the business person to solely focus on their brand which eventually helps them to improve their product quality.