Selling or leasing used vehicles considering their energetic type, the potential demand for leasing, and the expected maintenance costs

The economical decision of whether leasing or selling used vehicles remains a challenging task for several enterprises that are willing to renew their fleet of vehicles. We consider a fleet of used vehicles of different types (Diesel, Electric, Hybrid, ... ). Considering demand from different prospects interested in leasing a number of second-hand vehicles for a given mission profile, a mathematical model is developed to determine to which prospects it is the most profitable to lease the used vehicles and furthermore the number of vehicles to be leased, and the remaining ones to be sold. The mathematical model consists in the expression of the expected leasing profit function which integrates revenues from leasing, resale, and penalty on one hand, and maintenance costs on the other hand. A numerical example is presented and discussed to illustrate the use and relevance of the proposed model. The obtained results show that for each type of vehicles, expected usage rates and maintenance costs that are borne by the company have a significant impact on the decision about leasing and selling. (C) 2022 The Authors. Published by Elsevier Ltd.

Automated summary

The economical decision of leasing or selling used vehicles poses challenges for businesses. A mathematical model is developed to determine profitable leasing prospects and quantities, while considering maintenance costs.