What was Budget's net investment in leased vehicles in 2024?
Budget Franchise · 2025 FDDAnswer from 2025 FDD Document
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| (30) |
| Currency translation adjustments and other | | (3) | $ 523 | $ 1.071 | | Goodwill as of December 31, 2024 | $ | 548 | $ 523 | 3 1,071 | | Goodwill as of December 51, 2027 | | | | |
8. Vehicle Rental Activities
The components of vehicles, net within assets under vehicle programs are as follows:
| 2024 | 2023 |
|---|
Source: Item 21 — FINANCIAL STATEMENTS (FDD page 79)
What This Means (2025 FDD)
According to Budget's 2025 Franchise Disclosure Document, the net investment in vehicles under lease was $74 million in 2024. This figure represents the company's financial stake in vehicles that are leased out rather than owned outright. This number is important for prospective franchisees to understand because it reflects Budget's strategy of utilizing leased vehicles as part of its operations.
For a potential Budget franchisee, this indicates that Budget uses vehicle leasing as part of its business model. Leasing vehicles can affect the franchisee's financial obligations and potential profitability. It is important to note that the net investment in vehicles under lease decreased from $31 million in 2023 to $74 million in 2024.
Understanding the dynamics between vehicle ownership, leasing, and manufacturer repurchase programs is crucial for assessing the financial health and operational strategies of Budget. A prospective franchisee should investigate the terms and conditions of these leasing arrangements, including interest rates, residual values, and potential risks associated with vehicle depreciation and market conditions. This information will help in evaluating the overall financial viability and potential returns of a Budget franchise.