To Buy or Rent an Event Vehicle – That’s the Question, Now What’s the Answer?
A common quote request we receive is for the conversion of an HGV or bus into a bespoke event vehicle for a specific project.
Over 70% of these quote requests are for vehicles to be used for, what we consider to be, short-term periods, usually 3 months – 6 months occasionally up to 12 months.
Conversion costs will vary from vehicle to vehicle and coachbuilder to coachbuilder, we have seen buses where the total cost of vehicle, conversion and branding were less than £30,000 others were the overall costs were over £375,000.
Saying that the £30k vehicle was basically a bus with branding on the outside, most of the seats removed from the inside and a bit of electrical wiring threaded throughout for lights, the £375k version was a new vehicle with a complete, bespoke, interior.
However, when you look at the conversion realistically you realise the overall cost is somewhere in between, usually around the £100,000 mark for a decent 2nd hand double decker bus converted to British Standards, with all associated branding and mechanical work undertaken and that’s before it starts touring.
Once it starts touring you add operational costs, these being maintenance, vehicle and public liability insurance, repairs/parts, storage, road tax, fuel, oil, driver and driver expenses, not to mention the hidden costs of ownership i.e. yours or your staff’s time in processing all of the above.
So How Do You Decide Which is the Best Route?
Well to some extent this is a simple arithmetic problem.
Forget the operational aspects of a tour, for the time being, and simply divide the assumed development and branding cost of £100,000 by the number of weeks you are operating the vehicle for, realistically this needs to be below £2,000 per week for vehicle ownership to be a valid alternative to renting the equivalent vehicle, even if you need to modify the interior of the rental vehicle to meet your requirements.
Now contact your friendly neighbourhood Promotional bus hire supplier, hopefully Roadshow Promotions and ascertain what the cost would be for the equivalent hire period, with branding and any modifications to suit requirements.
From that point the economic factors provide the answer to your dilemma.
We have done the arithmetic and the costs are almost identical, what do we do now?
Although we would be surprised if the numbers were that close, we do understand that a bespoke interior could raise the costs of a rental vehicle to a similar level as the outright purchase cost. If this were to happen then we need to look at the operational side of the equation.
On the operational side you have the hire of one or more staff to drive the vehicle, the vehicles insurance, both road and public liability in addition there are maintenance, repairs and if the worst came to the worst recovery and repair costs, not to mention fuel, oils etc.
With Roadshow Promotions and I would imagine other suppliers, insurance, maintenance and even breakdown cover is included as part of the hire cost, over a 12-month period we would easily see these costs adding up to an additional £10,000 and several hours per week of staff time.
Driver, driver expenses and fuel usage should balance out whichever route you go down, so the overall cost comparison should be firmly on the hire side of the equation.
What if we want the vehicle longer than 12 months, now which is the best route?
Renting vs Buying a Promotional Bus, should almost always work out to be the lower cost option for any use up to 18 months, however there are occasions where clients require a vehicle for longer term projects, to which we say read the next article Leasing vs Renting vs Ownership of a Promotional Vehicle