MORE SMEs are turning to business car leasing according to the biggest player in the business car finance game, Lex Autolease.
The company increased its small and medium sized customer base by 22 per cent last year. And it reckons even more SMEs are ready to contract hire their cars in 2013.
More than 9400 new SME business customers opted to lease or buy their vehicles through Lex Autolease last year, increasing the total size of the company’s small and medium sized customer base to 42,000 businesses.
Last year also saw sole traders and smaller firms becoming more aware of the costs associated with running company vehicles and increasingly opting for more economical and fuel efficient vehicles.
The result was the average CO2 emissions across the firm’s SME customer base fell by 10 per cent over a two year period, from 148g/km in 2010, to 135g/km last year.
Lex Autolease fact
Based on an average asset value of £10,000 for an SME vehicle – the total amount of new funding provided by Lex Autolease to SMEs during 2012 was £260m.
Tony Murtagh, head of SME at Lex Autolease, said: “Small and medium sized companies have a crucial role to play in helping to improve the UK’s economic fortunes. A large percentage of these businesses rely upon their vehicles to carry out their day to day operations and we want to provide them with the support they need to keep on the road.
“The support that we offer includes helping them to select the most appropriate type of vehicle for their business, analysing the different funding options available and guidance on how to best manage fuel costs.
“More than 40,000 SME businesses have chosen us as their vehicle partner. We want to significantly grow this figure in the forthcoming years.”
Why should an SME use a business car lease?
Editor’s comment
The beauty of using a business car lease for an SME is the access to new cars, new technology and better running costs at discounts that large fleets usually enjoy.
you have access to a brand new car every three or four years.
Importantly it helps cashflow. There’s no lump sum to find (except the initial three or six month deposit), less stress on company finances and budgeted costs over the period.
Whether you choose to contract hire through the company (a business car lease with VAT benefits) or use a personal lease (Personal Contract Hire) you have access to a brand new car every three or four years.
There are some drawbacks. If your company’s or your personal circumstances change, then you are locked into a contract (exit fees are high); and you need to make sure you keep the car in good condition (end of lease charges can ruin the experience – so make sure you understand the terms of the car lease).
But otherwise there’s much to recommend the leasing experience.
Many industry commentators believe we shall be leasing more cars in the future in much the same way mobile phones are covered on an agreed term.
For more on business car leasing click here: Car leasing v car purchase.
Ralph Morton, editor
