It is an interesting equation that the contract hire business is directly affected by the used car market more than the new one. Speaking to an Audi dealership recently he told me how few cars are beeing sold and how many are being released on contract hire options, the reason being such high residual values at the moment. In short this means monthly payments are down and superb cars are being driven away cheaper than last year. Talking to a seperate Mercedes dealership they exlpained than when it comes to contract hire, do not assume the cheapest C series saloon will be have the cheapest monthly payments, oh no there is one particular model which is cheaper to hire than the base model, because it’s current residual value is so high.
When a contract hire agreement is made the monthly payment is based on how mcuh that vehicle will be worth at the end of the contract. the more it is worth, compared with th intial buying price, the less the monthly payments should be. So the current high resellable prices has meant contract hire for some models is cheaper than ayear ago. Of course you should do your own research as there is still variable prices out there from dealerships and brokers.