What if…? is a question that inventors and creative types ask themselves before making history with their ideas. We asked ourselves that very question, so as to continue improving fleet management.

You will soon find the results in our white papers, which we will make available to you at regular intervals this year. Here’s a little teaser:

What if… we were to set up the most important types of financing not from a leasing perspective, but according to the customers’ needs?

1. Short-term, flexible financing
   • Example: Twenty vehicles need to be procured quickly for a special order. Here, renting is the best solution.
2. Standardized financing.
   • Example: Vehicles in a fleet are used in a clearly predictable manner. This is where classic closed-end leasing works best.
3. Standardized financing with a purchase option at the end of the term
   • Example: Vehicles will not show up on the balance sheet during the term but are often “proffered” to the lessee at the specified residual value. In this case, partial amortization with a purchase option is the best choice.
4. Very high flexibility and sales revenues at the end of the term
   1. Example: The use of the fleet cannot or should not be planned months or even years in advance. In addition, the fleet owner will receive the proceeds of the sale of the vehicles without decreases in market value being claimed. Here, open-end leasing, which we offer with our FlexLease product, is ideal.

The question remains whether we need so many types of financing? Well, that’s like asking why there are different types of cars. When it comes to off-road, an SUV is useful. When parking in the city, you are likely better off in a small car. And if you’re traveling with a football team, you need a bus. This is exactly how the various types of financing work. Not every part of your fleet is used the same way. And living with COVID-19 for a year has taught us that even a “perfect” plan can end up in the trash. In this case, you might need a solution like open-end leasing, which you can flexibly terminate or extend. With short-term capacity increases, renting can be a sensible transitional solution.

In the last decade, closed-end leasing has dominated the German market as the standard solution. But even a hundred years ago, there were different types of cars, because not every customer had the same needs. Leasing practices in Germany remained almost unchanged for decades. In recent years, however, the financing market has also finally begun to move. More and more financing options are being added, which in many cases can make more financial sense than conventional standards. The decisive factor, whether now or in the past, is which solution fits your company’s current needs. We would be happy to advise you.