Missing something?

[Alfred the average]

Just had a quote for a new telehandler price bang on 100k , However I can hire one for 6 months at £350 a week from the same dealer with all repairs ect .
4 years of hiring for 6 months is £36.4K
Buying new and HP over 4 years the total cost is £117k with interest. Say residual is £60k .

I will spend with hire £36.4 K
Buying if you sold at the end for £60k I will have spent £57k . The handler is only with me for 6 months but that is peak demand my other 3 can easily manage the rest of the time.
What am I missing?

 

[e3120]

The chance that it's worth more than 60k.

The risk that the hire rate is adjusted.


If they can find someone for the other 6 months, everybody's a winner.

 

[Moors Lad]

Any idea what sort of hours it`ll be doing in those 6 months..?

 

[David1968]

Just had a quote for a new telehandler price bang on 100k , However I can hire one for 6 months at £350 a week from the same dealer with all repairs ect .
4 years of hiring for 6 months is £36.4K
Buying new and HP over 4 years the total cost is £117k with interest. Say residual is £60k .

I will spend with hire £36.4 K
Buying if you sold at the end for £60k I will have spent £57k . The handler is only with me for 6 months but that is peak demand my other 3 can easily manage the rest of the time.
What am I missing?

It works for you. But you're missing the fact that not many people only need a handler for 6 months in the year.

Double your hire cost and look at it again...

 

[Rich_ard]

A long term hire might be less than £350 a week.
I hired a construction one for £320 a week short term. I think they would do a 6 month cheaper yet. It wasn't a brand new one though.

 

[L P]

Just had a quote for a new telehandler price bang on 100k , However I can hire one for 6 months at £350 a week from the same dealer with all repairs ect .
4 years of hiring for 6 months is £36.4K
Buying new and HP over 4 years the total cost is £117k with interest. Say residual is £60k .

I will spend with hire £36.4 K
Buying if you sold at the end for £60k I will have spent £57k . The handler is only with me for 6 months but that is peak demand my other 3 can easily manage the rest of the time.
What am I missing?

You're missing 6 months and how many hours you'd put on it.

 

[icanshootwell]

If it's only a back up machine, do you have to buy New!! plenty of good machines around 30 /40 k with loads of life left in them.

 

[Moors Lad]

Any idea what sort of hours it`ll be doing in those 6 months..?

Might give us an idea if a new one would last you a good few years.... PLUS,. you`ve got it there all year!!

 

[betweenthelines]

Anything on long term hire is expected to be returned in "as new" condition and you get billed for any wear & tear

That's "show room" condition, not "it's been on a farm for a while, what do you expect?" condition.

 

[MF CI]

£350 a week hire is for 6 months in the first Year, years 2 3 and 4 hire could be a lot more than £350 a week.
On the plus side is no servicing or breakdown costs and if it stops working I would say they are obliged to get you another machine. If you buy, even under warranty it could be stopped for days at a time.

 

[betweenthelines]

£350 a week hire is for 6 months in the first Year, years 2 3 and 4 hire could be a lot more than £350 a week.
On the plus side is no servicing or breakdown costs and if it stops working I would say they are obliged to get you another machine. If you buy, even under warranty it could be stopped for days at a time.

Living in cloud cuckoo land if you think a broken down hire vehicle is replaced quickly.

Last time I phoned for a replacement contract hire Artic tractor unit following a breakdown, I was told "nothing available for at least a month." That's on a 100+ unit contract within (nominally) replacement in 24 hrs. Currently working with less than 90% of the hire fleet on the road.

 

[MF CI]

Living in cloud cuckoo land if you think a broken down hire vehicle is replaced quickly.

Last time I phoned for a replacement contract hire Artic tractor unit following a breakdown, I was told "nothing available for at least a month." That's on a 100+ unit contract within (nominally) replacement in 24 hrs. Currently working with less than 90% of the hire fleet on the road.

Not in cloud cuckoo land at all, "I would say they would be obliged" does have an amount of questionability in it. I only have experience of hire cars and when one failed the hire company bent over backwards to get me another. If you are taking 100 units on hire and they can't replace one when it breaks down, and only having 90% on the road it's time like the op to take a look at all the options.