What are the pros and cons of short-term contract hire?
• Your short term needs are met using new vehicles requiring little maintenance • You can change vehicles frequently to meet differing needs • Fixed cost motoring – Short-term contract hire allows you to budget for the period of each hire knowing exactly what your monthly outgoings will be. • Road Fund Licence –incorporated into the agreement. The downsides to short-term car leasing are the costs. Though it will generally be more cost-effective to take out a short-term car lease than a long-term daily rental, the fact is that most new cars depreciate most rapidly during their first twelve months – the length of a typical short-term contract. Therefore, payments are unlikely to be as cost-effective as long-term deals. Finally, it is important to consider that both short term contract hire and long term are currently considered as off balance sheet funding.
