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Warning issued over leasing company maintenance extension refusals

Date: 05 December 2022   |   Author: Sean Keywood

Some leasing companies are refusing to extend maintenance packages when vehicles are taken beyond their initial contract into a fourth or fifth year, according to software firm Fleetcheck.

The company's managing director Peter Golding said that, although the practice did not appear to be widespread, it was creating significant problems for some fleets.

He said: "Ongoing production issues mean that many fleets can't get hold of the new vehicles that they need and so are extending their current leases well beyond the original three- or four-year termination point. This has been going on for some time.

"However, we are now hearing some reports from within our user base of leasing companies extending the car or van but refusing to do the same with the maintenance element. 

"To some extent, this is understandable - once a vehicle is out of warranty and heading towards a six-figure mileage, maintenance costs both increase rapidly and become less predictable - but it does leave those fleets high and dry."

Golding said that, because the fleets in question habitually bought maintenance packages with their lease, they tended to have no arrangements for buying their own servicing in place.

He said: "This is a double-edged problem, really. These businesses need to quickly create a structure for maintaining the vehicles in question while, at the same time, they lose the certainty of a fixed monthly maintenance cost.

"They may well find major bills arriving for items such as cambelts or a complete set of tyres that is massively in excess of what they are used to paying to keep their vehicles on the road. It's quite a financial and managerial shock."

Golding said that there were no easy answers for businesses in this situation and it once again showed how difficult the effects of new car and van shortages could be.

He said: "Production delays are causing many kinds of issues, from slowing down electrification to service and maintenance conundrums of this kind. 

"It really would help fleets if the supply situation started to markedly improve in 2023, although there are mixed reports about how likely that might be."

 



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