Lease or Purchase of Ambulances

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Permalink Reply by Ryan Branch on September 13, 2012 at 12:25pm

Sean,

It's been my experience as a fleet manager responsible for new vehicle purchases yearly, that leasing is a great way to go. However, there is a difference between "leasing" an ambulance and leasing a passenger car. In a normal, passenger car lease, you agree to a monthly payment for a pre-determined time period. When that time period is over, you surrender the vehicle back to the dealership or purchase the vehicle.

Leasing an ambulance is completely different. You do not, and cannot return the vehicle to the dealership. Leasing an ambulance is virtually the same as financing vs. out right paying. When you lease an ambulance, you work with a lien holder to come up with a payment arrangement. At the end of that arrangement, you own the ambulance.

A few good things I discovered with leasing.

1) You can try local credit unions but completely avoid the normal lien holders that work with general automobiles. They have no idea how to work within the emergency vehicle community. There are specialty lenders for ambulances such as Republic 1st National, Leasing 2, even M & T bank has a special division. These brokers understand the industry. We make 1 payment yearly. It's easier to do this rather than monthly payments. Once our budget is approved, we send out 1 payment and we are done.

2) You keep the title. In most states, to legally run EMS, the vehicle must be inspected by the State. Ownership paperwork must be documented. The agency needs to hold the title for the vehicle. The specialty lenders allow the agency to keep the title.

3) Payment deferral. Most lenders can and will defer your first payment 1 full year after you take delivery of your ambulance. With most manufacturers building at 6-7 months lead time, this essentially gives you 17+ months to continue building your finances AFTER you have already signed a contract for a new rig. In our case, that 18 months of keeping our money in the bank built up some great interest. We use the interest to make most of the yearly payment. After 5 years, the interest will have paid for 80% of the vehicles we buy instead of our actual capital.

4.) Also, the specialty lenders understand budgets, donations, emergency purchases, town involvement.. etc. While I have never had an issue where I had to contact our lender and push back a payment because of a budget not being approved or something else, they have been very clear in the willingness to work with us if need be.

Hope this helps.

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