Residual value leasing is a common form of vehicle financing in the commercial sector. It plays an important role in fleet management as it enables companies to use vehicles at predictable conditions – but with a particular focus on the calculated residual value at the end of the term.
What is residual value leasing?
With residual value leasing, an estimated residual value of the vehicle at the end of the leasing period is determined at the start of the contract. This value is based on an estimate of the future market value. The monthly leasing installment is the difference between the new price of the vehicle and the agreed residual value, plus any interest and fees.
At the end of the leasing contract, the lessee returns the vehicle – or optionally buys it at the specified residual value. If the actual market value on return differs from the calculated residual value, additional payments or refunds may be made.
Advantages of residual value leasing
- Lower leasing rates: With an optimistic residual value assumption, the monthly installments are often lower.
- Purchase option: companies can take over the vehicle at the end of the contract – often at an attractive price
- Flexibility: Particularly suitable for fleets with varying requirements or frequent model rotation.
Risks and challenges
- Residual value risk: If the actual market value is lower than the calculated residual value, the lessee must bear the difference.
- Market fluctuations: Economic developments, model changes or drive changes (e.g. towards electromobility) can have a strong influence on the residual value.
- Condition assessment: The condition of the vehicle on return has a significant influence on the achievable sales proceeds.
Residual value leasing in fleet management
With this form of leasing, fleet managers should pay attention to a realistic residual value calculation and regularly monitor the vehicle value. The use of fleet software or leasing portals can help to identify market developments at an early stage and react in good time.
Conclusion
Residual value leasing is an attractive leasing option for companies that can deal with potential market fluctuations and value low monthly installments. In professional fleet management , it offers flexibility and potential for cost optimization – but requires sound planning and continuous controlling.
