HYRYDE – Powered by Reliance Worldwide in London, U.K. Michael Griffin, Director of Affiliate Relations Generally speaking, if a car has a high depreciation value, then you’d be better off leasing, whereas if a car has a low depreciation value, you’d be better buying and reaping the benefits later when you decide to sell it. However, if you are an individual who likes your car to feel like “yours” and is happy to keep it for a longer period between changes, buying is probably the best option. The choice is determined by your personal preference as a company or individual.įor those who like to have a new fleet of cars and want to keep up with the latest models, leasing is probably more appealing to a company, as you can change your fleet more frequently and monthly payments are more affordable. There’s no clear-cut rule as to which option is best, as there are benefits and drawbacks to both. To buy or not to buy, that is the question. I need to learn more about the option for the future.Īirport Limousine Service in Wheeling, W.V. However, I would entertain that option in the future, since I know that other operators in our area do it. We have always bought our vehicles because we have been told that leasing “does not apply” to high-mileage livery vehicles. instead of having everything go to a leasing company and then back to you. Also, I’ve found that you get better rates on purchasing, and I feel like it’s better to control the paperwork, tickets, etc.
I think that if you take care of your vehicles, they are worth a fair amount at the end and you get a portion of your expense back when you sell your used cars. In the past, we have leased our vehicles, but eventually switched to buying. Palm Beach Tours & Transportation in West Palm Beach, Fla. This is particularly true in the case of our larger/more expensive equipment (e.g., minibuses) as they tend to be less age-sensitive.
Further, with our in-house maintenance and repair facilities, the age and mileage of a vehicle is relatively unimportant, as long as the appearance is properly maintained. We have found this formula to be much more beneficial. Typically, the company purchases our vehicles and takes the Section 179 accelerated depreciation expense to minimize income taxes. I have leased on a few occasions, but those incidents have been rare, and due more to the low-dollar buy-out in the end. After 35 years and counting, I’ve always made money on the sale of used vehicles. It’s an advantage to own if I need to dump a car early: That hit is more easily absorbed. There sometimes may be positive write-off advantages with leasing, but I still prefer buying. I feel better about the guarantee of equity on the back end. I have always bought our vehicles in lieu of leasing. TOPIC: Do you lease or buy your vehicles? In your experience, what have been the pros and cons to each approach? If you would like to participate, please email Rob Smentek at for next issue’s question. In this column, we ask operators of all sizes and from all walks of the industry a question about their business and report their answers so you can assess how your own company compares to your peers.
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