Business Car and Van Hire

What is Car Hire?

Car hire is simply an all-encompassing term that is used to describe when you pay a monthly price for the use of a car. This can be for as little as a day or as long as several years depending on the type of hire agreement you take on.

Car hire can be a very useful tool in fleet management as it’s a flexible funding method that is easily tailored to your company’s, and even the specific driver’s, needs. It can be short or long-term depending on your requirements, and a short term can usually turn into a longer-term solution or vice versa if your needs change.

Car Hire Finance Options

For short-term car, or van, hire you will need to rent a vehicle. This allows you to use a vehicle for as little as one day and you will be able to arrange this on relatively short notice.

If you want to hire a vehicle long-term there are two primary options available to you – long-term rentals or leasing.

There are also agreements similar to a contract hire but are instead a contract purchase, which are sometimes known as a hire purchase where you purchase the vehicle at the end of the contract period. If you’d like to learn more about these then please take a look at these guides that covers the different types of fleet funding.

What Are the Business Benefits of Car and Van Hire?

There are a number of benefits that hiring a vehicle instead of owning it outright and these include:

• Fixed regular payments making it easy to budget for vehicles
• Monthly payments can include maintenance provisions for reduced overall vehicle costs
• No depreciating asset on your company books
• Can reclaim some if not all of the VAT on certain agreements
• You set the terms of the length, for example the length of time that you have the car
• Vehicles can be available on short notice
• Vehicles can be available for short periods of time if you only need a temporary

Considerations with Business Car and Van Hire

Although there are many benefits to vehicle hire there are a few things you need to consider when deciding if hiring is the right choice for a particular vehicle. We recommend asking yourself four simple questions and the answers to these should help you decide whether hiring the vehicle is the right choice.  

1. What will the vehicle be used for? And is it likely to still be in a returnable condition under the BVRLA’s fair wear and tear guidelines?
2. How long is the vehicle needed for?
3. Does the vehicle need to be modified in any way? This includes if you would like to add signage to it.
4. How many miles do you expect the vehicle to clock up? Especially if you’re considering leasing as there will be a mileage allowance and a charge if you exceed this.

Choosing the Right Funding Option for You

If you are considering hire as a funding option for your business then we recommend looking at the alternative funding methods available to you to ensure that it is the best choice for your business.

Additionally, we recommend using a combination of different funding methods across your fleet to ensure that you are not overexposed in any area and run into issues because of this. We find that a lot of our clients use a combination of leasing and owning vehicles outright for the majority of their fleet and then utilise rental vehicles for short-term needs. It’s important that you consider your fleet as individual vehicles as well as the full fleet as you will likely find that some drivers or vehicle roles will be best suited to a particular funding strategy.

Wessex Fleet Car and Van Hire

Here at Wessex Fleet, we are able to organise short and long-term hire arrangements for our corporate clients, including rentals and leases. If you would like to learn more about this and how we can help you with your vehicle supply needs, then please give us a call on 01722 322 888 and our team will be happy to answer any questions you have.