Mobility is an integral part of not only the economic growth of a nation and corporate excellence but also everyday social life.
However, the question of the cost of ownership compared to leasing motor vehicles is usually riddled with several factors that inform an individual’s or corporate decisions depending on the immediate needs.
Large corporations and government entities are increasingly preferring to lease their fleet as opposed to purchasing, as lease agreements come with several advantages including car maintenance and servicing, and insurance which are shouldered by the leaser thereby reducing associated costs incurred by these entities.
Loxea, a sister company to Cfao Motors seeks to offer a solution. Established in 2009, the company operates in 23 African countries, with a fleet of 6000 motor vehicles, leased to both corporates and individuals.
Speaking to journalists at the company offices in Nairobi, during a media roundtable, Loxea Managing Director Jennifer Kinyoe projected that the sector will witness an upsurge as companies across industries prioritize flexible vehicle leasing models to streamline operations, reduce costs, and improve fleet efficiency.
“Kenya’s vehicle leasing market is maturing, and Loxea has positioned itself at the forefront of this evolution. We have grown exponentially since 2009 by delivering tailor-made leasing solutions that meet the demands of businesses in Kenya’s vibrant economic landscape, and we are determined to capitalize on the momentum”, Kinyoe said.
Compared to the rest of Africa, leasing is more popular in West African countries with Ivory Coast leading the park. Several advantages come with this model of operation as compared to ownership, with its accompanying costs.
For instance, Loxea’s policies are tailored to meet the clients’ needs by offering a plethora of services in the lease agreement through a 360-degree approach to fleet management.
The Loxea system comes with Geo-location which helps corporate companies with a leased fleet track the movement of the vehicles through route optimization.
Additionally, the client can monitor and analyze fuel consumption, and carbon emissions through the system to optimize the performance of his or her motor vehicle.
The company also provides free driver training to reduce loss associated with poor driving and vehicle handling. This is not just a leasing solution, but a solution to optimize the fleet.
Over the past three years, the government has been systematically implementing policies to curb carbon emissions and propel the movement to e-mobility, such as the introduction of the Euro-4 emission standards. This has seen a surge in lease agreements as the cost of acquiring a new vehicle in compliance with the policies has substantially increased.
Despite the gradual move to electric vehicles, Loxea hopes for more indications from the economy to shift to e-mobility. “Currently, the infrastructure is not well established to meet the market demands for efficient and reliable charging,” Kinyoe said.
She also highlighted the need for favorable tax policies and concessions to enable the ease of acquiring new vehicles that meet the required standards, to further sustainability and environmental conservation.
Their main target is corporates and SMEs. The MD said the informal sector is a prime market that requires solutions that meet their needs. She also highlighted the need for education in the informal sector to understand the advantages of leasing compared to fleet ownership.
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