SD Car Hire Start Up

[Sham91]

Hi guys,

Ive been searching this forum for the last few days looking for some answers and things to look out for.

I am currently in the process of starting a car hire business in Yorkshire. I know everyone talks about it being a bad idea and there being lots of competition etc but I believe this is something I can really get going.

As a new venture I've actually had a few quotes for self drive hire policy....recent one today was £3500-4000 per vehicle :0....I guess it seems about right for a new business with no experience in the field ?

I will only be offering prestige and performance vehicles, nothing over 300bhp and 2.0 engines.. market value of each car would be nothing over 25k (cars wont be brand new, year or two old)

I am looking at obtaining at start up an Audi s3, Golf R & Mercedes C Class. These cars are very popular as everyday and special occasions.

Now at the moment my only question is I will be financing these cars via independent dealers locally but would I be able to sub hire these cars on genuine hire policy that I will obtain :/ I've obviously enquired with a few contract hire/leasing places and due to their t&c they have said no, so I'm thinking with finance this shouldn't be an issue?

Any tips and advice would be highly appreciated and anyone in the self drive insurance field who can possibly advise, I would be grateful.

 

[TylerJay]

why dont you become part of a affiliate, where you dont need to own the cars but you have access to over 1000 makes and models?

Let me know your thoughts

 

[Mark T Jones]

The good news is that most finance companies will work around their 'hire or reward' clause.

The less good news is that as a start-up the terms will be quite tough - think 30% deposit and 2 year finance term.

 

[TylerJay]

do you think that route is the most sensible route though Mark.. Financing cars to then lease?

 

[Sham91]

why dont you become part of a affiliate, where you dont need to own the cars but you have access to over 1000 makes and models?

Let me know your thoughts

Hi Tylerjay sounds good,

Can I get more info please?

 

[Sham91]

The good news is that most finance companies will work around their 'hire or reward' clause.

The less good news is that as a start-up the terms will be quite tough - think 30% deposit and 2 year finance term.

not the kind of route I was hoping for

 

[Mark T Jones]

do you think that route is the most sensible route though Mark.. Financing cars to then lease?

I'm not sure what your alternatives are, ior what research you have done?

 

[TylerJay]

I'm not sure what your alternatives are, ior what research you have done?

I have a old client who works through an affiliate program. They get the cars at £x a month and they lease the cars for £x + £x on top.

Really easy business modules. Just based on sales and marketing

 

[Sham91]

The good news is that most finance companies will work around their 'hire or reward' clause.

The less good news is that as a start-up the terms will be quite tough - think 30% deposit and 2 year finance term.

I've actually been told there is a certain policy you can get which allows you to hire out financed cars.....is this what Mark T Jones is referring too.....

 

[Mark T Jones]

I've actually been told there is a certain policy you can get which allows you to hire out financed cars.....is this what Mark T Jones is referring too.....

You don't need a policy. You just need the lender to confirm you can hire them out

 

[Mitch3473]

I've actually been told there is a certain policy you can get which allows you to hire out financed cars.....is this what Mark T Jones is referring too.....

You can or could do it through the main dealers,It's how the car manufactorers get registered numbers on the road and dump their old models. Back in the late 90s I was paying £99 per month to Toyota finance for Corollas, same for Puntos to Fiat finance, Meganes etc etc and putting them out at £29/day, £149/week. All however were tied to mileage and 12/15/18 mth contracts, they would then go back to the main dealers and sold on the forecourt.

 

[TylerJay]

You can or could do it through the main dealers,It's how the car manufactorers get registered numbers on the road and dump their old models. Back in the late 90s I was paying £99 per month to Toyota finance for Corollas, same for Puntos to Fiat finance, Meganes etc etc and putting them out at £29/day, £149/week. All however were tied to mileage and 12/15/18 mth contracts, they would then go back to the main dealers and sold on the forecourt.

This would work! I like your style

 

[Mark T Jones]

You can or could do it through the main dealers,It's how the car manufactorers get registered numbers on the road and dump their old models. Back in the late 90s I was paying £99 per month to Toyota finance for Corollas, same for Puntos to Fiat finance, Meganes etc etc and putting them out at £29/day, £149/week. All however were tied to mileage and 12/15/18 mth contracts, they would then go back to the main dealers and sold on the forecourt.

That mixes the dealer/ manufacturer with the finance - they are related but separate entities

About the time you mention we worked with one of the largest providers of cars to the rental industry. As you say, working mostly with concessionaires they block bought fleets with big discounts and guaranteed residuals after 12 or 18 months.

Financing wasn't easy, we were 1 of 5 brokers they used literally scouring the market to put facilities in place (this was an established, profitable business whose directors were highly qualified and experienced.

The OPs model doesn't seem to reflect this.

 

[webgeek]

Personally, I liked the approach of Ling's Cars - the ugliest site on the internet and that of Rent A Wreck - where you can rent a beater that no one cares if it gets a scratch or a ding

 

[Sham91]

Guys thanks for all the feedback.....

So over the weekend I was close to purchasing an Audi s3 saloon 2014 fully loaded around 22k mark.

The only thing that made me step back was the hire policy...Now I'm thinking since I've decided to buy this car outright I can easily put it on a borrow policy if someone was to approach me to hire it out by maybe using insuredaily.co.uk or even taking a business insurance out for any driver 25 and over?

Good idea or bad

 

[dy-ven]

Bad idea, both ways will most likely exclude "hire and reward" use, and do you really want to risk a 20k car should there be an incident that requires a claim.. I would suggest take a hit on your first years hire policy and hopefully from yr 2 onwards your rates should go down.

 

[Black Panther]

A bit of a sticky one this is, you are better of getting an operating contract or business leasing contract with a self-drive hire insuri. what is the point of spending 22K on ONE car when you can use that 22K and get a fleet of about 5 high-end cars with massive saving and extra funds to invest in insurance etc? I've seen heaven and hell when it comes to this sector and although it is a profitable business it can get difficult and extremely stressful if you don't know what you are doing

 

[MrADott]

I know this thread is fairly old but then what is the catch, how would one go about it if they was to get a car on some sort of contract either finance or lease in order to then hire it out to other users via SDH insurance?
As I’ve heard from majority of people that most companies are against leasing to then hire out the car to other users, so how would one get a car on finance or lease to put it on hire?

Any help appreciated