ollie989898
Member
That makes sense then, LR can show a profit over manufacturing cost much easier, say the real cost to them is £20k they show a big profit on the rentals and eventual sale, and it gets car on the road to entice more buyers at List.
The main bonus is for company owners/directors who use the car to offset their tax liability. It is a pure cost to the business and so eats into tax. Not the cheapest way to run a car by any means but people do it.
I do know someone who runs a little Toyota thing on lease or whatever the heck it is called. The payments are of course a lot more reasonable but you still don't own a car at the end of it. I think for some drivers the idea of owning/servicing/tyres or whatever in a car scare the hell out of them frankly so they would rather pay what is in effect a monster mobile phone bill and just drive something spangly. Once electric cars become mainstream it will become even more popular because people won't see the cost of fuel.
Car companies must love it because they are getting the drip-drip-drip of guaranteed risk-free income and demand for new cars is artificially inflated. Someone turning up, buying a new car with 30,000 quid and then disappearing never to be seen again at a manufacturer backed dealer is no good to them.