Hiring long life

The term Location Long life (LLD) is mainly used for the hiring long life of fleets of vehicles Automobile S with the companies. This activity, appeared at the end of the Seventies, gradually was essential in the Western large companies to replace the purchase into clean of the vehicles or the payment of kilometric allowances (IK).

The hiring long life (12 to 72 months) is opposed to the hiring known as short duration (of a few hours in a few months) more known, and to the hiring very short duration, or Autopartage (of less than one hour at a few hours).

It is generally about a simple hiring without option to buy of a vehicle. Contrary to the leasing which is a financial hiring the hiring long life is an operational hiring. Indeed, leasing is a kind of credit irredeemable disguised in hiring. The financial backer, owner of the material gives it in hiring to a tenant and it is the latter which takes completely charges the operational exploitation with it with the rented good: maintenance, repair, insurance,…). In the case of the operational hiring and in particular in the case of the LLD the contractual rents also include/understand the loads related to the preventive and curative maintenance, the labels and the replacement of the vehicle in the event of prolonged breakdown. It is about a strong commitment of the hirer out towards the tenant. Hirers out LLD thus propose a complete service in counterpart of which they perceive a rent " complet" including/understanding all the contractual services. With the economic plan, it proves in a large majority of the cases which the hiring long life is more advantageous. Indeed, the economies of scale carried out in the hirers out (power of purchase, mutualisation of the loads, rationalization and optimization of the information systems) make it possible the companies users to optimize the costs of exploitation of the park. Better still, these last also profit from an optimized management all while being devoted to the priorities of their trade.

The tariffing of a LLD breaks up into financial hiring and performances of service: management of fleet, maintenance, assistance, tires, vehicles relay, insurance, labels or taxes, technical controls. The financial rents are calculated taking into account a value of resale envisaged of the vehicle this value is called residual value. For this reason, it is to be stressed that the hirer out assumes a big risk: that of the resale of the vehicle. If it underestimates this residual value, it is likely to inflate its rents artificially and thus to lose in competitiveness. If it over-estimates it, it will propose a low tariffing and takes the risk to resell well the vehicle with a value in on this side its value of market and in the long term to carry out a depreciation on the vehicle. From where importance of the use of the systems of valorization of the type ARGUS in the calculation of the supposed values of resale. To circumvent this difficulty, certain hirers out propose the repurchase of the vehicle by the driver. This technique makes it possible, on the one hand, to fix in advance the value of resale and, on the other hand, of responsabliser the user of the vehicle which, knowing that it sarait owner in the long term of it, takes better care of it.

The large actors multi-marks of the market are Leaseplan (VAG), Arval (BNP Paribas), GE Capital Fleet Services (General Electric) and ALD (General society). In Morocco, we can quote (Chaabi LLD), created in partnership between the Moroccan and French Banque Populaires.

The car manufacturers also developed their own companies, often resulting from their subsidiary companies of financing: Diac for Renault, Peugeot Parc Alliance for Peugeot (one speaks then about " captive" because related to only the marks of the manufacturer) or in multi-marks, DCS Fleet Management for the group DaimlerChrysler or FAL Fleet Service for the group FIAT.

More information on www.lld.fr, the gate of the Hiring Long life

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