Steve Hart: An idea with mileage

COMMENT

For that long, relaxing drive across Europe there's nothing better than being behind the wheel of a factory-fresh car of your choice with all the bells and whistles such as CD player and security features.

But how do you get one? It's easier than you might think.

Peugeot and Renault are two firms with offices in New Zealand offering an alternative to renting - they let customers lease a new car straight off the production line.

Delwyn Sinclair for Peugeot EuroLease says the benefit of the scheme is that customers get a car with just delivery mileage on the clock. And more importantly, she says, all the paperwork is completed before you book your taxi to the airport.

"It's all done before you go. You won't end up standing at the front of a long queue, jetlagged, being asked to sign here, here and here without having the time to weigh up the benefits of the extras that are frequently offered."

Leasing a car for a holiday is not a new idea but many people, says Sinclair, do become anxious at the thought of "owning" the car as the vehicle is registered in their name.

"I can understand customers thinking, 'Peugeot will not want to take the car back', but it's all in the contract and there's nothing to fear - there's no catch."

John Devaney, marketing manager at Avis, says renting a car is ideal for people who want more freedom on holiday.

"Hiring is a flexible option because many people choose to use a car in one place for a short term, then fly or get a train to somewhere else and then rent another car.

"Customers can also hire different cars. If they are going to meet up with friends they can pick a larger car. For city driving they may select a smaller model that's easier to park, and then maybe go for a 4WD if they want to get to a stream for a spot of fishing or something."

He also says the age of cars used by the larger rental firms such as Avis isn't an issue, as most of them are under a year old.

But what about the cost - how does leasing compare with renting?

A Peugeot 307 XR 1.6L (petrol) will cost $1329 for 17 days (the minimum term allowed) from Peugeot EuroLease. Additional days cost $32. There's no insurance excess and no restrictions on the number of drivers - because you as good as own the car.

You can return the car to many locations in France and Geneva free of charge.

Renault EuroDrive, which also has offices in New Zealand, has similar prices for comparable cars.

An issue with the lease option is that cars are left-hand drive only - which means that, while they are available in Britain, the steering wheel will be on the "wrong" side. Some people choose to cope with a LHD car before heading to France on the Shuttle.

A car equipped for a disabled driver isn't a lease car option either - but it's something most hire-car companies, such as Avis or Hertz, for example, can supply, although numbers are limited.

Hire-car firms are not able to guarantee the model you will get when you book, but using the same group in which a 307 appears - and choosing an international hire car firm at random - Hertz quotes $1200 for 17 days, or pay in advance and save $124. Extra days start at $68, which reduces on a sliding scale, there's a $40 charge for each additional driver and an insurance excess of around $1600 (which may be covered by your travel insurance - check before you pay to reduce your excess liability).

In common with other hire-car firms, Hertz also charges from $40 a day for drivers aged under 25, and a "location fee" for the collection of cars in high-profile locations such as airports (amounts vary). For some people it's cheaper to get a taxi from the airport to a fringe city location to pick up their hire car.

People booking in advance still have to fill out the hire-car application form on arrival and may be restricted to the days specified when the car was booked.

But what happens to all these new lease cars after they've been used once?

"Peugeot build 21,000 cars a year for the lease scheme and once used they are sold to dealers outside France," says Sinclair. "Some may even end up in the hands of car rental firms."

She says there has been an 8 per cent increase in New Zealanders leasing cars in Europe over the past year, with more than 1000 booking through Peugeot in the past 12 months.

"Leasing is a much smaller market when compared with the traditional hire-car business," she says. "But it's growing as people become more comfortable with the idea."

For long-term use the lease-car option can be good value - although it's always worth asking if the rental firm can negotiate its price.

However, the lease scheme is helped by the French Government, which subsidises it, so from a business point of view it doesn't appear to be a level playing field for private rental car businesses.

But for people who want to use a car for a few days at a time and have the freedom to hop across Europe by train and plane, the hire-car option is the only way to go.


Leasing versus rental cars:


Benefits of leasing:


* You are guaranteed a new car.


* Get the exact model you want.


* Probably get the colour you want.


* No insurance excess.


* Almost anyone can drive it.


Downside of leasing:


* Minimum 17-day lease period.


* Only available in Europe.


* Left-hand drive only.


* Car seats for children under 10 will need to be bought.


Benefits of renting:


* Daily hire is an option.


* Cars for the disabled may be available.


* Car seats and roof racks can be hired.


* Some companies offer a points reward scheme that can lead to free hire days.


Downside of renting:


* Can only choose the category of car.


* Insurance charges can push the price up.


* Restrictions on drivers.