Sale and Leaseback Program

Capital

A sale and leaseback program is utilised where an organisation owns its vehicles and would like to move them to a lease model. In such cases, StreetFleet purchases the vehicles using price guides for above wholesale value on each vehicle and then leasing those same cars back to the organisation under an operating lease method (explained in following section).

 

This approach has several benefits:

 Provides capital injection into the organisation

  • Organisation is already familiar with vehicle fleet operations
  • No wait time for vehicle supply
  • Quick turn around
  • Reduced administration costs
  • Detailed fleet reporting and monitoring
  • Maintenance controlling
  • One simple monthly repayment includes all expenses
  • Ease of budgeting
  • Fleet usage can be easily broken down into hourly rates
  • Provides clear parameters for fleet upgrading

The below table shows indicative sale and leaseback pricing for this case study, wherein a client owned 9 people movers with disability modifications in some cases. The client in question was having issues with budgeting for increasing maintenance costs and wanted the ability to report on their fleet’s usage and easily work through hourly costs for the impending NDIS rollout.

Note that all indicative lease pricing below includes:

  • Servicing for lease term
  • Replacement tyres per 40,000km travelled
  • Registration for full term
  • Extended warranty (subject to insurer’s acceptance)
  • Roadside assistance for full term (optional)
  • Fuel card facility (optional)
  • Wheelchair lifter servicing for full term (if applicable)
  • Full reporting suite (FBT, usage, fuel, expenses, accidents etc)
  • All pricing is based on terms shown (options are 1-5 years)
  • Km restriction is based on each vehicle’s current annual distance travelled (rounded up)

 

Year

Type

Modifications

Term (months)

Annual kms

Ex-GST Value

Current Monthly av. expenses

Monthly lease rental

(Ex-GST)

2010

Toyota Hiace

Wheelchair

60

12025

$24,800.00

$190.00

$516.57

2014

Kia Carnival

8 Seater

36

52374

$13500.00

$265.00

$649.67

2011

Hyundai Imax

8 Seater

36

26500

$16,500.00

$250.00

$718.31

2009

Toyota Hiace

Wheelchair or 7

36

20031

$20,590.00

$215.00

$613.44

2015

VW Caddy

Swing Seat

60

12891

$36,363.40

$200.00

$708.60

2012

Toyota Hiace

Wheelchair

60

15501

$27,036.00

$245.00

$584.72

2010

Toyota Hiace

12 Seats

60

21805

$22,727.00

$350.00

$692.08

2012

Toyota Hiace

12 Seats

36

28635

$26,363.00

$315.00

$833.47

2013

Toyota Hiace

12 Seats

36

42938

$25,454.00

$315.00

$959.47

 

 

 

 

 

$213,333.40

$2,345.00

$6,276.33

 

In the above case study, we are able to free up $213,333.40 for the client to invest back into their organisation with a new monthly lease cost of $6276.33 per month (including all running and administration costs).

What happens at the end of the lease?

At the end of each lease, the client has the option to:

  • Simply hand the vehicle back (no balloon payment)
  • Extend the vehicle for a further term (1-5 years)
  • Replace the vehicle with a new vehicle lease
  • Buy the vehicle at the market price at that time