The Car and Truck Fleet and Leasing Management Magazine

Personal Contract Purchase

In the U.K., a lease financing arrangement between an individual and the leasing company, typically used for employees of companies who receive a monthly car allowance as part of their remuneration package.

With a PCP, the individual finances the chosen vehicle over an agreed lease term. The monthly payments of a PCP are lower than in traditional financing arrangements because the amount amortized is the difference between the vehicle's original value and its Minimum Guaranteed Future Value (MGFV), essentially a projection of the vehicle's residual value.

At the end of the agreed term, the individual can choose to return the vehicle to the leasing company with no further responsibility except for minimum condition standards and allowable mileage, to resell the vehicle with the individual credited with any sale price excess over the MGFV, or the individual may purchase the vehicle at its MGFV.

Previous

PCP

Comment On This Item

Name:  
Email:  
Comment: (Maximum 10000 characters)  
Leave this field empty:
* Please note that comments may be moderated.

Blog

Market Trends

Mike Antich
Why the Fleet Manager Should be the Gatekeeper to Procurement

By Mike Antich
The strategic procurement process typically involves a multifunctional sourcing team. This cross-functional team often designates a “gatekeeper” responsible for controlling the flow of information to the group. When selecting a fleet supplier, I strongly believe the fleet manager needs to be the gatekeeper. Here are the arguments supporting this assertion.

Cost Control is Constrained Without Driver Buy-in

By Mike Antich

View All

Driving Notes

Chris Brown
2017 VW Golf Alltrack SEL

By Chris Brown
The 2017 Volkswagen Golf Alltrack is a Golf SportWagen, but brawnier, with VW’s 4Motion all-wheel-drive as standard.

2017 Mercedes-Benz E300 4Matic

By Chris Wolski

View All

Nobody Asked Me, But...

Sherb Brown
Five Unpredictions for 2017

By Sherb Brown
We may not be able to predict the future here at Automotive Fleet, but we can confidently predict that 2017 will be very interesting.

Fleet Success Comes From Sticking to Just the Facts

By Sherb Brown

View All

Data Points

Dylan Brown
Does Telematics Branding Translate to Adoption?

By Dylan Brown
We asked over 750 fleet professionals questions about the prevalence of each provider in the market and their brand recognition.

How Fleet Size Dictates Telematics Needs

By Dylan Brown

View All

In Memoriam: Coach's Insights

Ed Bobit
Thinking of the Newbies of the Future

By Ed Bobit
A lot has changed in the past 10-15 years, so we can only imagine this momentum will continue into the next decade-plus. How will this change impact the fleet manager of tomorrow?

Managing a Car vs. Work Truck Fleet

By Ed Bobit

View All

STORE

More From The World's Largest Fleet Publisher