Renting a car for a specific fixed amount of time and at a relatively low price is known as a car hire contract. Many car rental companies offer a contract car hire option, and the industry is consequently fairly competitive (which is of course great news for the consumer).
Contract car hire is conceptually composed of two elements:
1. The person or business / company leasing the car never actually owns the vehicle in question – i.e. the car is leased
2. The car is to be used for a pre-fixed period of time that has been agreed upon by the rental company and the person or company leasing the vehicle in question
The contract car hire industry is flourishing due to the business trend of offering company employees various benefits. Of all the benefits any company can offer an employee, the bestowing of a free company car is considered to be the single most symbolic and appreciated perk that any staff member is ever likely to receive. Most contract car hire occurs within this sector (i.e. car rental companies have agreements with businesses who in turn offer company cars as an incentive to their most valued employees).
By never actually owning a car, the company employee benefits in a variety of ways:
Most importantly, the company employee receives a free, new car to use whenever and wherever he wants – a very nice bonus in these difficult credit crunch days. Other than the purchase of property, a car is the single most expensive acquisition that most people make in their entire lives. Not only does any individual need to deposit a substantial amount of capital into purchasing the car itself, but the real value of the money spent also decreases as the car’s value depreciates – this in addition to the interest that the capital laid out on purchasing a car would otherwise be making.
The car’s temporary owner will not ever have to pay for any repairs that the car needs (and these will be few anyway as the car is new).
The company employee will receive a brand new car every four years or so (this is standard contract car hire practice).
In short, as a result of receiving a company car, the employee will find himself better off financially. He will also be the (temporary) owner of a practical status symbol of which he can be proud.
As far as the business / company is concerned, not only is the money that they are paying out for the contract car hire deductible against corporation tax, but most importantly, they are rewarding a valued member of staff.
It may not be very environment friendly, it may be relatively costly, it may arguably also be quite unnecessary, but business corporate culture is well aware that ultimately, a satisfied employee is also a productive and loyal worker.
Many people choose a short term car lease because it’s the best thing for them. People who love to have a different model car often benefit most from this type of lease. If you are a car enthusiast and can’t keep yourself from buying a new car every couple of years, you may want to consider a lease term of a year or two.
Some people think that leasing is a waste of money. You invest your money into a car that is not completely yours and you won’t be able to pay it off. You also won’t get your money’s worth since you won’t be able to run it into the ground as you would if you owned the car.
However, if that doesn’t interest you and you can’t see yourself having the same car for years, a lease would actually save you more money. You will be able to have a more expensive car that you normally wouldn’t be able to afford. Saving money is not the only benefit of a short term car lease, it also allows you to choose a car for particular excursions you want to take.
If you are planning to take a car trip during the warmer months and would love to have a convertible for it, why not lease a convertible? You can feel the wind in your hair and really enjoy your summer or spring getaway. Take it to the beach and soak up the sun while you roll down the strip. Convertibles are attractive and if you are single, you will definitely turn some heads.
Are you thinking of trying camping or hunting? You could get a short term car lease on a SUV or Jeep, which are both great vehicles to take off-roading. The SUV will provide you with the space and comfort to get you to the camping or hunting location. The Jeep will allow you to get through some rough patches in the woods without fearing you may get struck.
If you have a growing family, you may need a bigger vehicle to accommodate all of their things. You may only need a small SUV or minivan when they are younger but in the next year or two, they will start to have sports events and other extracurricular activities that require a bigger trunk. You can choose bigger vehicles every other year if you need it.
A short term car lease will allow you to choose cars that fit your current financial situation and lifestyle. Since you are not committed to the lease for long, you can choose a less expensive car if you find yourself in a financial blunder. Alternatively, if you receive a promotion at work or find higher paying employment you will be able to lease a more expensive car for your next lease term.
Choosing to lease a car short term is fun and economical if you love to try out new vehicles. There’s no need to commit to a car for 10 or more years any longer, you can now enjoy the new car smell every one or two years with a short term car lease.