Do I lease or hire purchase a vehicle for my Uber business?

2653

A few weeks ago, we wrote extensively on making money by joining Uber as a partner, also covering options on obtaining comprehensive vehicle insurance in Nigeria for this purpose. We have received lots of enquiries from potential partners who need more options for procuring standard vehicles for this venture, so we decided to write this article.

This will help you if  you’re without a car and thinking about driving for Uber, or if you have a regular source of income, need a car and dob’t want to pay upfront for it. We have reviewed two options which you might find quite helpful:

  • Hire purchase
  • Leasing

What is hire purchasing?

Hire purchasing is a contract in which you, (the purchaser), pay a small amount in the beginning and then make the rest of the payment in installments, over an agreed period of time (tenor) just like this Innoson deal. While leasing, is an agreement between you and the vehicle owner in which the lessor (vehicle owner) lets the lessee(user), use the vehicle for a specified time for a specific payment. This is basically a long term rental program.

A hire purchase consists of the following:

Real price of vehicle + Interest rate = Hire Purchase Price

Which in turn includes; HPP = Initial down payments + Monthly installments (Interest + Principal)

11235137883_bea3a16d72_z

What is leasing?

But if you should decide to lease, it is quite essential that you understand the basic lingo.

  • Capitalized cost is an expense incurred in financing the asset during the term of the lease. You must intend to keep this low, which in turn lowers your monthly lease payment due to low depreciation value. Let me explain why; a relatively expensive car can easily have a lower lease payment than a less expensive one because

Low Cap.cost – High Lease end Residual value + Interest = smallest Depreciation value

  • Residual value is the projected worth of the car at the end of the lease, after depreciation. It is the amount you can buy the car for after leasing.
  • Operating Lease: The lease which covers only a small part of the useful life of the asset. It is usually a short-term lease. In this kind of lease, there is no transfer of risk and rewards nor ownership.
  • Finance Lease: A lease agreement to finance the use of asset for the maximum part of its economic/useful life. The entire risk and rewards incidental to the ownership is transferred to the lessee with the transfer of the asset.

Leasing vs Hire purchase

Think of this as a comparison of the pros and cons of both options.

hire purchase

Requirements

How to get these options for your Uber vehicle

Hire purchase

  • Registered Uber partners: These individuals are already registered in the Uber platform as partners looking for drivers, most of them just want to put their idle cars to use or sell them off. You can find them here
  • Private individuals: These individuals are people with available cars to sell but understand the current economic state or do not want a one-off sale. They can be approached via referrals.

Leasing companies

Most lease companies request for service, preventive and corrective maintenance, extra mileage, insurance, vehicle tracking, and vehicle licensing/papers payments.

  • Fleet partners: They lease out vehicles at the most convenient means of payment through uniquely designed leasing options/ solutions to meet your financial needs. Contact them on: 0806 023 7746, info@fleetpartners.ng
  • C-I leasing: They are in franchise with Hertz Corporation, they are licensed by the Central bank of Nigeria to offer operating and finance leases, with a series of car rental services. For more enquiries: info@c-ileasing.com , 08172007171, 08172007230
  • Avis: this rent-a-car company is an American car rental service with branches in Abuja and Lagos. Visit them at their office address for rentals above 30 days.
  • First choice leasing: is a wholly owned Nigerian Financial Intermediation And Equipment Leasing Firm Incorporated in 2010. For enquiries call or email: +234 1 8839185, +234 802 321 6086, +234 862 360723, info@firstchoiceleasingltd.com, md@firstchoiceleasingltd.com

Although, they weren’t willing to give me information via email or phone, so be sure to carve out time to visit them if you’re interested.

Here’s a list of Uber accepted cars

Do you have any experience or thoughts on leasing or hire purchase, please let us know in the comments section.

Remember, it’s not your car so endeavor to pay your dues and make sure you understand the terms and conditions before you sign that agreement!

· · ·

Comments

  • What is the least model of car can I purchase to be uber partner

    Kayode olanrewaju May 22, 2016 6:15 pm
  • Cool, thanks for giving a clear picture on lease and hiring purchase, think I would go for hiring purchase this week, very informative

    Magnifique May 29, 2016 6:53 am
    • Thanks – glad to have been of help!

      mrpepe May 29, 2016 9:57 am
  • What year of cars needed and how much do i get paid at the end of the month.

    Amangbo Gerald June 1, 2016 7:58 pm
  • Thanks for this post, I have been on the look out for firms/individuals who can help with managing vehicle put in the uber system, the all offer seem to offer a return if N40,000 weekly, with an investment of close to N2.8million(vehicle purchase, registration,insurance etc) it will take 18 months to break even and the vehicle would have depreciated by a great %, any suggestion on uber partners with better offerings, I dont have d capacity to manage directly.

    Jide June 7, 2016 6:47 am
    • Hi Jide,

      Thanks for reaching out. As an investment, it’s usually a good idea to buy the cheapest most compliant vehicle available. I know a manager, but how much were you looking to get weekly?

      Thanks

      mrpepe June 7, 2016 9:37 am
  • Please am intrested in getting a car on hire purchase to put on the uber platform. Please link me up

    Onyinye July 16, 2016 8:49 pm
  • Please am interested in getting a car on hire purchase to drive on UBER platfom.please help me

    solomon July 17, 2016 4:22 pm
    • Hi Solomon,

      There are several ways to go about this

      1. You will find current car deals here: http://www.ubernigeria.com/car-deals/. I know Accessbank is running a “drive now, pay later” deal.

      2. You can start as a driver and ask your partner to offer you the car on a hire purchase contract

      All the best

      mrpepe July 18, 2016 12:31 am
    • Hi Solomon,

      You need to be a registered driver who is ready to drive to be able to get through to this stage. You can register through any of these driving agencies:

      Here are a list of drivers agencies in Nigeria who can get you started on the platform.

      Delight Consulting
      Contact person: Gbenga Raheem
      Contact number: 08054449419 and 08037107839

      Lington & Bernie
      Contact person: Lanre Oke
      Contact number: 08032298220
      Contact email: lanre.oke@lingtonandbernie.com

      WorkCenta
      Contact person: Angela Iyeke
      Contact number: 08029476384 and 08179275311
      Contact email: aiyeke@jobberman.com

      mrpepe July 20, 2016 12:42 am
  • woow this is great because as I’m talking to you, there’s no car stand I’ve not entered for the purpose of hire purchase but to no avail but I’m happy that I logged to this site I’m going for it if this is real.

    TJ AUSTINE July 23, 2016 7:27 pm
    • Glad to be of help, TJ. I think they probably turned you away because people tend to hire to people they already know, or met through a recommendation. A good way to start might be to start on Uber as a driver and then request a partner who operates by hire purchase.

      mrpepe July 24, 2016 12:36 pm
  • I saw used corola (banktype)@750ton.i dnt av money,i can pay 1.3m for hp @ 70ton monthly.i work in a school,taxi partime & av reliable sureties.contact innocent 08073900290

    innocent July 27, 2016 9:18 am
  • I need a car at hire purchase to used it on Huber platform

    barry ekemezie August 5, 2016 12:34 pm
  • Hi, I am a salary earner, and wish to buy fairly used car for uber through hire purchase. How can one get a good deal.

    chioma August 9, 2016 9:18 pm
    • Hi Chioma,

      If you register with Uber as a driver (here: http://ubr.to/2aZ0Iwy) you will get a welcome email and an invite to the marketplace, where I believe you get access to 3 companies/partners who offer hire purchase vehicles to salary earners specifically for this purpose.

      mrpepe August 10, 2016 2:30 pm
  • Thanks for the information on hire purchase and leasing. I want a car to use for Uber on hire purchase. I won’t be the one to drive the car. Can i still register as a driver to access the offers?

    Nonny November 16, 2016 2:15 pm
  • I need help am a driver in uber I need a car for hire
    Purchase I am register that I can pay for one Yar and 6 months thank

    Michael igwe November 16, 2016 10:28 pm
    • Hi Michael, please could you e-mail me : ctrl@mrpepe.com

      I have someone who is looking for a driver

      Ethan Okoli November 20, 2016 8:58 pm
  • Pls I Need A Van Or Pick Up Vehicle For Hire Purchase, How Do I Go About. Patrick

    Patrick December 4, 2016 5:57 pm
    • Please contact the guys at wemove.co, as they might be able to help. 08086514565

      Ethan Okoli December 5, 2016 3:48 am
  • Connect me on how to get a hire purchase I will prefer that than leasing

    Gbenga John December 14, 2016 6:25 am
  • Hi, I need a car to lease on uber in Abuja. Please can you advice me on how to go about this?

    Lanre January 4, 2017 4:07 am
    • Hi Lanre,

      You might be better off purchasing a car on an instalment plan as the prices are close, but you own the car at the end of the period. If you haven’t registered, you can do so using this link: https://partners.uber.com/i/q8jfrewhue

      Then you will need to check out the accredited dealers in the Uber marketplace. There are 3 providers in Abuja: Stallion, Chevrolet and Kia motors. Here’s a link to the dealers: https://drive.uber.com/ngmarketplace/location/abuja/

      Ethan Okoli January 7, 2017 10:08 am
  • wooo am very happy to get on this page,am an uber driver in Lagos,plz hw can I get to uber market place in Lagos,I need a car,tnx

    prince January 12, 2017 1:10 am
  • Hi, I’m a driver on uber, I need a hp Toyota corolla car here in Lagos.

    Racheal January 15, 2017 4:26 pm

Leave a Comment

Your email address will not be published. Required fields are marked *