Residual value setting

Overview

Residual value is the estimated projected market value of the vehicle at the end of its lease.


A vehicle's residual value is established at lease inception, to ensure that the user is charged an appropriate fee.

Residual values vary according to the particular make and model of a vehicle. The higher the residual value assigned to a particular vehicle, then the cheaper that vehicle is to lease.

VicFleet sets residual values based on industry forecasts and direct knowledge of trends in second-hand vehicle markets. A conservative approach is adopted to reduce the financial risk of significant losses on sale of vehicles.

Residual pointers:

  • vehicles with higher kilometres generally yield lower residual values;
  • vehicle colour is important; and
  • vehicles in good condition have higher residual values.