Leasing companies provide longer term vehicle hire with an agreed mileage limit, typically for a period of 12, 24 or 36 months. The contract often includes some sort of maintenance and breakdown cover.
There are a number of leasing options and the choice will depend upon a range of different circumstances, including whether you are a business or private customer, whether you want to take the residual value risk associated with the vehicle and whether you want the option to buy it at the end of your lease.
The dominant form of lease is contract hire, which has more than 50% of the market.
Businesses like leasing because it is a flexible and fixed-cost form of motoring which means they don’t have to worry about the depreciating value of their fleet.
Funding vehicles in this way also frees up working capital that can be invested in other parts of a business.