How business finance keeps the bus and coach sector moving 

Department of Transport statistics show that every year, Britons undertake billions of bus and coach trips, with bus journeys accounting for three in every five public transport journeys. These figures confirm how vital the bus and coach sector is to the UK’s transport network, and how important it is to keep buses and coaches moving.  

The bus and coach industry in the UK is an important part of the overall economy and key to the country’s public transport system. However, there are specific financial challenges faced by the bus and coach sector, whether the business is a small fleet owner or a large scale operator. A lack of working capital makes it difficult to acquire new, much needed vehicles: this can stagnate the growth of the business. Making sure you’ve got access to enough funds to guarantee your fleet remains fully operational will allow you to fulfil your contractual obligations to your clients and ensure your company remains profitable. 

This is where business finance can help. Business funding can help spread the cost of purchasing new vehicles, or release working capital from current assets to provide businesses with a cash boost. Here, we’ll look into the ways that business finance can help keep the bus and coach sector moving. 

Business finance for buses and coaches 

Business finance can help to spread the cost of investment in new vehicles, or release working capital from your current fleet and equipment. There are finance packages available for both new and Approved Used vehicles.

Three key types of business funding that can benefit the bus and coach sector are as follows:  

Hire purchase 

Hire purchase allows bus and coach companies to acquire an asset (such as a new vehicle) which spreading the cost over time- paying for it in instalments over an agreed timescale. At the end of the repayment term, you would have the option to purchase the asset outright. 

This form of business finance is a flexible way of financing an asset acquisition which lets bus and coach businesses spread the cost of the investment over the life of the asset, making it easier to budget. 

Finance Lease 

Finance Lease arrangements allow bus and coach companies to use the vehicles they need without having to buy them outright. It is almost like paying to “rent” the vehicle for the full use of it. The rental period is flexible and can be tailored to individual needs and cash flow. When you reach the end of the primary lease term you can choose to: 

  • Continue to use the asset by entering a secondary rental period 
  • Sell the asset and keep a portion of the income from the sale 
  • Return it

Operating Lease (Lease with Residual Value)

Similar to a Finance Lease, an Operating Lease allows a business to rent the asset for the time that they need it. The key difference between the two is that an Operating Lease is only for part of the asset’s useful life. At the start of the lease the equipment’s residual value is forecasted, the customer then pays a fixed payment over the contract term for use of the equipment and returns it at the end. 

The business gets full use of the asset for as long as they need it, without the burden of responsibility of disposing of it or recouping its residual value.

How PMD can help with finance for the bus and coach industry 

We believe that nothing should stand in the way of business growth. We understand the challenges faced by the bus and coach sector, and we will work with you to source finance options that will ensure that your business can grow without limits.

By fully explaining all your options, we’ll help you identify the most appropriate route to acquire new assets or unlock the value of existing ones. 

 Over the years, PMD has built a number of strong relationships with 150 leading lenders. This enables us to match our customers’ specific circumstances and requirements directly with the appropriate lender, making the acquisition of business finance much more manageable. 

If you work in the bus and coach sector and are considering business finance options, get in touch today to see how PMD can help.  

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