When it comes to commercial vehicle lease options, one size doesn’t fit all.
The goals and needs of each business are unique, which means one fleet may need a different solution from another. Here’s the good news: No matter what business you’re in, or how big your fleet is, there’s a lease option out there that’s a fit for you.
To help you get started, here’s an overview of two common types of business vehicle leases.
If flexible terms and fewer lease-end fees appeal to you, an open-end lease may be what you’re looking for.
With a typical open-end vehicle lease, you won’t owe excess mileage fees at turn-in (no matter how many miles you put on the vehicle). This makes open-end leases an appealing option for vehicles with high or unpredictable mileage.
You also shouldn’t expect to see excess wear fees on your final open-end lease statement, even if the vehicle has taken a beating as part of your fleet.
All this is possible because when you take out an open-end lease, you’re responsible for the vehicle’s residual value (the estimated value at the end of the lease term).
At lease end, you’ll have options to purchase the vehicle for the agreed-upon residual, trade it in or sell it. Again, any residual shortage and selling expenses will be your responsibility, so you’ll want to take good care of it to get the maximum value for your business.
Some open-end lease products, like GM Financial’s The Right TRAC®, let you determine your monthly payment by setting the term and residual that works best for you and your business.
The Right TRAC® also offers:
- Vehicle ownership at the end of the lease with flexible residuals
- Terms ranging from 24-60 months
- Included GAP coverage
- No mileage restrictions or excess wear-and-use issues
- A wide range of vehicle customization and upfit options
With a closed-end lease, you can turn the vehicle in at the end of the lease term.
This means you don’t have to plan ahead for the responsibility of owning and reselling the vehicle, which can be a relief for today’s busy fleet managers.
Closed-end business vehicle leases typically are subject to lease-end excess mileage and excess wear-and-use fees. This makes closed-end leases a great potential fit for predictable-use vehicles that don’t rack up huge mileage.
You'll need to take good care of the vehicle to avoid excess wear fees at the end of a closed-end lease term. But since you'll be returning it, you may not need to stay on top of maintenance as closely as you would with an open-end lease.
Closed-end leases may offer additional opportunities to write off certain lease expenses at tax time. Consult your tax adviser about whether this is a possibility for your business.
Specific closed-end lease products can offer additional features and benefits. For example, GM Financial’s The Right Lease® includes:
- Off-balance-sheet financing
- Lower monthly payment and shorter terms
- The option to lease new vehicles
- Lease-end options to buy or turn in.
When you’re ready to learn more about closed-end leases and discuss whether GM Financial’s The Right Lease® is right for your business, GM Financial commercial leasing experts are standing by to talk.
We hope this helps you get started on the path toward finding a commercial lease product that’s right for your business.
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