Alphabet warns against four-year contracts
24 May 2010
Mark Sinclair is boss of leasing firm Alphabet
Top 10 leasing firm Alphabet has warned against fleets moving to four-year contracts as a matter of course, pointing to the rate of development from car manufacturers leading to companies "locking themselves" out of potential operational savings through lower tax and fuel use.
"Between now and 2020 there will be a lot of change in technology, the cars we drive now will be very different to those of 2020 and that could be either two or three car changes depending on the change cycle," said Alphabet boss Mark Sinclair. "If you keep a car for four years you are locking yourself into that cost base."
Sinclair said three-years and 60,000 miles is still the industry standard but some fleets did start to move out to four years and 80,000 miles during 2009. "It can work with relatively low mileage drivers but waters down some of the benefit of the company car," said Sinclair. "Employees are paying for the benefit in taxes so how many people will do that for a four-year old car?"
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