Forum Discussion

HUGEHomePros's avatar
HUGEHomePros
Jobber Ambassador
3 days ago

Owning vs Leasing Commercial Vehicles. What's better and why?

I've heard the plusses and minuses of both these. From the higher level CEO's I've heard talk on the subject, they basically say never buy a vehicle in the company name. I've done both. 

My first two vehicles - one is a 2016 Tacoma and the other a 2020 ford transit connect. The Tacoma has been a work horse. No problems. The 2020 transit, I bought an extended warranty on. The transmission needed replacing while it was under warranty BUT the warranty company fought me tooth and nail on replacing. Fortunately I was able to convince them to but if not, I would have been on the hook for $10k AND still owed like $15k on it. No Bueno.

THen I leased a bigger Ford Transit. This I did through a company called Jump Spark. They rolled the wrap, the upfit and the lease payment all in one then leased me the vehicle. I think technically they are the ones that own it. It was like $2k out of pocket and I pay $1300 per month for 60 months. So definitely a higher cost but I have the option to trade it in after a couple year. 

I feel like if you never have repairs, buying would be the way to go. How do you all feel about this?

2 Replies

  • Sheldon876's avatar
    Sheldon876
    New Member
    22 hours ago

    Maybe it's just me but buying always works out in the end. But lease depending on your current situation.

  • Fletch's avatar
    Fletch
    Contributor 2
    11 hours ago

    If the vehicle has to be specific, then leasing may make the most sense. The vehicle is an operating expense, and you get the right vehicle for your needs.  As you noted, the leasing company owns the vehicle. The lease is effectively a long-term rental.

    In my case, a "lightly" used U-Haul box truck was the answer.  I was able to buy a 2008 Ford E-450 from U-Haul with about 140k miles for just under $10k all in.  It's clean and runs like a champ. The cab design hasn't changed in 18 years, so it doesn't look dated. 

    In the year I have owned it, I have driven almost 25K miles.  I have replaced a tire and the tie rod ends.  It is about to get two more tires. Otherwise, the only expenses have been insurance and registration, fuel and routine maintenance. 

    I have modified the box by adding an RV door and steps on the side, so I am not always going in through the rear roll-up door.  Plenty of room inside for my packout stacks, ladders and saws, and still room for job supplies like lumber, drywall and plywood. 

    It is about the same length as an extended Transit, but a bit wider and taller.  It handles surprisingly well.

    The biggest downside; it hasn't seen a gas pump it doesn't like.  8 mpg is tough at $5.00 a gallon.

    I had given thought to leasing a van.  With a $1300 lease payment, the U-Haul would be paid off in 8 months.  That leaves a lot left over for fuel and, more importantly, funds to redirect into the business.  If the truck suddenly tanks, it would be easy enough to send it off to the scrap yard without shedding a tear and get another one. Again with the 60 month, $1300 lease payment, I could buy 7 U-Hauls.

    In my case, I can adapt the truck to my needs.  But if the needs are specific, leasing a purpose built truck makes sense.