Contract Hire and Personal Contract Hire

For both products you supply the customer a vehicle and introduce Mazda Contract Hire as the funder. Your customer simply hires the vehicle from Mazda Contract Hire for a pre-determined period at a fixed monthly rate. Mazda Contract Hire retains ownership of the vehicle - and the risks associated with ownership - and at the end of the contract the vehicle is returned to Mazda Contract Hire.

Features of Business Contract Hire

Off balance sheet funding

Under Contract Hire vehicles do not appear on your customer's balance sheet as they are owned by Mazda Contract Hire. The removal of capital assets from the balance sheet can enhance a company's gearing (borrowing) ratio.

Fixed monthly cost

A fixed monthly payment is charged over the life of the contract and the initial up front payment is normally just three months rental. Fixed monthly costs for the period of the contract makes budgeting much easier. In turn more accurate budgeting improves your customer's cashflow.

VAT Benefits

Contract Hire has many VAT benefits in that Mazda Contract Hire can claim back the VAT on the purchase price of the new car. That means we pass on these benefits to our customers. Once the vehicle is on the road, customers can then claim back 100% of the VAT on the servicing element of the rental cost and 50% of the finance rental cost.

Reducing your Financial Risks

Managing the risks involved in running a vehicle fleet is all important and that's exactly what can be done with Contract Hire. Mazda Contract Hire takes all the risks involved in everything from residual values and maintenance to interest rates. That leaves the customer to simply pay the monthly Contract Hire costs, insure and fuel the vehicle.

Reducing administrative hassles

Mazda Contract Hire work closely with the entire dealer network to organise the supply, service and disposal of your customers’ vehicles. As a result, administration for the fleet operator is kept to a bare minimum.

What if my customer purchases its current fleet?

We have substantial experience in assisting our customers through the transition from more traditional funding methods to Contract Hire. This can be achieved by allowing us to purchase the current fleet, at an agreed price, immediately enabling your customer to take advantage of the financial and administrative benefits outlined on page 2, for a fixed monthly rental.

Features of Personal Contract Hire

Convenient monthly payments

Personal contract hire allows a private individual to pay a monthly rental for a fixed term contract and then hand the vehicle back at the end of the contract. This avoids any exposure to the used car market and also allows them to include additional services such as servicing and tyres to avoid one off costs associated with owning their own car.

Drivers ‘opting out’ of company schemes

Mazda PCH can be particularly attractive to company car drivers who ‘opt out’ of their company car scheme and take a monthly car allowance instead. The additional services on offer through Mazda PCH mean that they do not lose all the benefits of driving a company car. They are also not restricted by the choice list on their company scheme or by CO2 emissions.

VAT implications

As a non-VAT registered private individual a Mazda PCH customer will not be able to reclaim the VAT so please ensure that any monthly rental or initial payment figures quoted to the include the VAT.

Early Settlement and De-hire Damage

As with Business Contract Hire a contract can be terminated early however the customer will be charged 50% of the outstanding rentals remaining. The vehicle will be assessed when it is returned and the customer will be charges for damage not deemed to be ‘fair wear and tear’ (following BVRLA guidelines).

Mileage limits

The customer’s contract will have a maximum mileage limit; if they exceed this an excess mileage charge will apply at the pence per mile rate agreed in the contract. However if I customer is running under or over mileage they can contact Mazda Contract Hire customer services to discuss the possibility of amending their agreement.