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Average rental length growing during recession
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The average length of van and truck rental is growing during the recession, according to TLS Vehicle Rental.
The GE-owned commercial vehicle rental specialist says that businesses are turning to rental when they need transportation in the longer term because it offers more flexibility than outright purchase or leasing.
Carl D'Ammassa, chief executive officer at TLS, said: “On our fleet, the average rental length has increased during the last year and requests for quotes are 25% up, both factors that we believe have almost entirely been prompted by the recession.
“There are all kinds of factors making rental attractive at the moment. Businesses that would normally lease may be uncomfortable entering into new three or four year agreements; those that would normally buy may want to hang on to their money to preserve cash flow; others may simply no longer have the lines of credit available to them to lease or buy.
“Rental circumvents all of these problems. If you need a van or truck, we can have one with you as soon as you can get to a depot or delivery can be arranged. You can then keep that vehicle for as long as you need it and hand it back the moment that you don’t.”
D’Ammassa added that rental rates remained highly competitive in the commercial vehicle sector and that this was another factor that was attracting customers.
He said: “Most rental companies are seeing upward pressure on rates but most are managing to minimise any increases and the customer is benefitting. Commercial vehicle rental rates in general are, we believe, something of a bargain at the moment.”
Like other highly flexible business models such as using supply staff and serviced office space, commercial vehicle rental was very much a product that fitted in with recessionary thinking, D’Ammassa said.
“If you read the news, some experts say that we could be out of recession later this year while others believe that we are entering a depression that could last a decade. Against this backdrop, businesses find it difficult to plan with any degree of certainty.
“What rental allows them to do is stay flexible. When they need a van or truck, we can provide one. They can keep that vehicle for days, months or years without worry but then hand it back the moment the requirement for it ends.
“That is the beauty of rental and it is a way of acquiring a vehicle that appeals to many businesses at this point in time.”
Carl D'Ammassa, chief executive officer at TLS, said: “On our fleet, the average rental length has increased during the last year and requests for quotes are 25% up, both factors that we believe have almost entirely been prompted by the recession.
“There are all kinds of factors making rental attractive at the moment. Businesses that would normally lease may be uncomfortable entering into new three or four year agreements; those that would normally buy may want to hang on to their money to preserve cash flow; others may simply no longer have the lines of credit available to them to lease or buy.
“Rental circumvents all of these problems. If you need a van or truck, we can have one with you as soon as you can get to a depot or delivery can be arranged. You can then keep that vehicle for as long as you need it and hand it back the moment that you don’t.”
D’Ammassa added that rental rates remained highly competitive in the commercial vehicle sector and that this was another factor that was attracting customers.
He said: “Most rental companies are seeing upward pressure on rates but most are managing to minimise any increases and the customer is benefitting. Commercial vehicle rental rates in general are, we believe, something of a bargain at the moment.”
Like other highly flexible business models such as using supply staff and serviced office space, commercial vehicle rental was very much a product that fitted in with recessionary thinking, D’Ammassa said.
“If you read the news, some experts say that we could be out of recession later this year while others believe that we are entering a depression that could last a decade. Against this backdrop, businesses find it difficult to plan with any degree of certainty.
“What rental allows them to do is stay flexible. When they need a van or truck, we can provide one. They can keep that vehicle for days, months or years without worry but then hand it back the moment the requirement for it ends.
“That is the beauty of rental and it is a way of acquiring a vehicle that appeals to many businesses at this point in time.”
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