Information about Operational Fleet Rental
Long-term Fleet Rental refers to renting of to customers for a pre-defined term and range of services in order to meet their fleet needs for the purpose of performing their sales, marketing and distribution functions and serving their management staff.
Operational Fleet Rental is a rental scheme where the customer makes use of the cars in the most effective way rather than just using them. As a financing method not requiring capital, Long-term Fleet Rental is preferred by many companies to meet their fleet needs.
As the vehicles are not entered as an asset, the company's liabilities will not increase in its balance sheet and its credibility will enjoy a positive effect. Customers' cash flow will not be affected negatively either, because the financing costs will not be paid off their equity capitals. Monthly invoices of rental charges can be entered as direct costs, so that the customers enjoy tax benefits.
Title to the vehicles, risks of material losses i.e. accidents, theft, damages, pledge which might be suffered by any of the vehicles during the rental term, and the investment risks are at the account of the lessor.
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