Who takes the residual value risk and how do the residual values compare?
Various options are available. In the case of operating leases, residual value risk under the D.I.Y model is taken by the owner / lessor. With a view to delivering the sustainable best in market fleet lease facility we have developed a RV risk management strategy that has as its aim the setting of residual values at-the-money (i.e. at amount that is forecast to be the expected future market value of the vehicles concerned by independent experts) rather than in-the-money (i.e. at a lower amount). We also engage our customers in the monitoring of residual value exposures and re-invest net profits on sale.
