However a fleet is funded there is the risk of incurring ‘hidden’ or ‘unforeseen’ costs and its imperative to include them when budgeting.
End of contract charges will apply if the agreed contract mileage is exceeded and a 20,000-mile excess at 10p per mile would cost you £2,000 per car.
“Leasing companies are also well within their rights to charge for damaged vehicles and many businesses underestimate the cost of vehicle refurbishment,” explains Jackson.
Maintenance budgets and vehicle age/mileage need to be closely controlled to avoid excessive costs and to ensure no under/over servicing occurs.
“Fleet management companies may have better maintenance rates and controls than you’re able to apply locally and so their pay-on-use maintenance services may save you money,” adds Jackson.
“But before you enter any lease agreement, get clarity on what all the potential charges could be - a cheap rental can often be much more expensive when these are factored in.”
Fleet Funding: Beware of ‘hidden’ charges
- 22 February 2010
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