Heavy Duty Financing: Are You Doing it Right?
Generally speaking, acquiring a light to medium duty truck is mostly straightforward once the appropriate considerations are given to vehicle application and length of use. However, when it comes to financing a medium to heavy duty vehicle, things can get complicated.
“What’s the cost of the vehicle? What kind of up-fitting is needed? Is it a specialty unit that takes a long time to build and typically has a longer life?” These are a few questions Charlie Johns, Regional Truck Manager of ARI Canada says are important to analyzing the appropriate method of heavy-duty vehicle financing.
Once the appropriate truck is chosen for the fleet, it is important to examine the residual value, return on investment and the term of use. Be sure the residual value is as small as possible at the end of the term and determine the economic life of the vehicle. This type of financing approach meets the existing needs of the business and creates a fleet that is no longer a cost to the company but rather a strategic asset that delivers value.