Business Car Leasing vs. Business Car Rental in Los Angeles
Perks of Business Car Leasing
Business car leasing is the most common type of leasing
in today’s economy. It is even more popular than personal car leasing. This is mainly due to the fact that most businesses and corporations choose to have company cars for their employees. Most of these cars are leased from business car leasing companies.
Despite the growing popularity of business car leasing, there is still some confusion surrounding the differences between business car leasing vs. business car rental in Los Angeles. Let us outline some of the main distinctions between these two forms of temporary vehicle ownership.
Leasing vs. Renting A Business Car
The most important difference between business car leasing vs. business car rental in Los Angeles is the duration of the contract. Car Leases are normally long-term deals spanning a period of 2-3 years. Car rentals, on the other hand, are typically for a shorter time period, lasing for a few weeks or days. This means that a business car lease involves more obligations for the lessee than a business car rental.
Another main difference between business car leasing and business car rental in Los Angeles is the mile cap on the vehicle. A lease will normally have a mileage allowance between 12,000 and 15,000 miles per year. The lessee is required to pay a fee for each extra mile driven past the maximum allowance. Leased cars are also subject to depreciation over time, which is not a relevant issue for rental cars. Rental cars change hands frequently, are not usually brand new when rented to the next customer.
What Does Business Car Leasing Involve?
When it comes to a business car lease in Los Angeles, there are some factors which are non-negotiable while others are variable.
Some of the main variable factors include the capitalized cost of the vehicle (selling price), the money factor (interest rate), and the trade-in price of any vehicles included in the deal.
The non-negotiable factors include the residual value of the vehicle and the acquisition fee. The residual value is the value of the vehicle at the end of the lease term. When it comes to business car leasing in Los Angeles, some leasing companies may be open to negotiating a deal for an entire fleet of vehicles.
It is quite clear that business car leasing and business car renting are two very different types of operations. Each has its own set of obligations on the part of the lessee and the provider. This basic knowledge should help some businesses know what to expect when it comes to signing up for business car leasing or business car rental.