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Days: end contracts early to dodge damage charges

Date: 09 August 2013   |   Author: Jack Carfrae

Fleet operators can be better off by terminating contracts early when they have damaged vehicles, according to leasing firm Days Contract hire. Excessively worn or damaged vehicles have the capacity to rack up charges that outweigh the cost of running the vehicle until the end of its pre-agreed term, so businesses would be wise to cut their losses and end contracts early to avoid excessive charges, according to Aled Williams, director at Days.

Speaking to BusinessCar, he said: "Sometimes the client is actually better off giving us back damaged vehicles rather than continuing to have them, paying the rental on the vehicle, paying for the damage to be repaired - and then it may then not be down to a standard that we're comfortable with."

Williams claimed fleets would be better off identifying and dealing with damage as and when it happens rather than at defleet time, and that there are big cost savings to be made by managing and reacting to it early.

"The cost during the contract period can be critical as well, where damage, if it's not managed properly, can cost the client quite severely," he said.

"Whether it's a wing mirror knocked off or damage to the mechanics that aren't covered by the maintenance part of the contract, it's very important that we're involved in that when we're trying to drive down the costs on any contract, which is something that can be overlooked.

"When you look then at the whole cost of the contract going backwards, it's quite surprising how much that [kind of damage] can affect the overall cost - and I don't know how many clients look at that."

He said understanding the parts costs that come with certain vehicles was another way of recouping big savings, and procuring vehicles based on parts and repair costs that operators are likely to encounter is well worth anticipating.

"It could be a manufacturer that produces a particular van that the client has a history of knocking wing mirrors off, and the difference in the cost of a wing mirror between manufacturer A and manufacturer B could be a couple of hundred pounds.

"It's things like that that you need to be aware of - what damages has that client experienced during normal operations?"



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