Fleet Handbook China

• Financial Lease (including Direct Leasing and Sale and Lease Back)
• Operating Lease
• Full Operating Lease
• Fleet Management
• B2E tailor-made Employee Loyality Program

Service, maintenance and repairs, insurance, fuel card, roadside assistance, registration, accident management, vehicle sourcing and acquisition, total cost of ownership consultation.

• Minimum: 12 months/5.000 km per annum
• Maximum: 60 months/60.000 km per annum

The Lessor (HERALD) purchases the vehicle on behalf of the Lessee. The Lessee then leases the vehicle back from the Lessor and pays a fixed monthly lease rental for the term of the lease. When the lease ends, the Lessee can pay the remaining amount and purchase the vehicle..

Taxation and registration
The structure of the Direct Lease requires the OEM Dealership sell the car to the Lessor and issue the VAT (16% deductible) Fapiao to the Lessor. The car will be registered under Lessor’s title using Lessor’s license plate. HERALD retains legal ownership until the contract is paid out. Depending on the payment schedule, the Lessor will issue full rental amount VAT Fapiao (16% deductible) to the Lessee.
The purchase tax is calculated as (MSRP *0,9) / 11,7 and has to be paid by the Lessee (included in the Lease or paid one shot).

The Sale and Lease Back is a type of financial lease that have its unique definition in China (comparable to a Mortgaged Financing).
The structure of the SLB requires the Lessee to purchase the vehicle and the Lessor supports funding solution. SLB requires the Lessee to pay the initial down payment amount; and the Lessor is paying the remaining amount to the OEM Dealership during car purchase. The Lessee can choose to finance related cost or not (purchase tax, insurance, etc.).

Taxation and registration
The car will be registered under Lessee’s title using Lessee’s license plate. The car will then be mortgaged to the Lessor, the Mortgage remain in place until the contract is fully paid out. Based on the payment schedule, Lessor will issue respective interest non-VAT Fapiao (6% un-deductible) to the lessee.
The purchase tax is calculated as (MSRP *0,9) / 11,7 and has to be paid by the Lessee (included in the Lease or paid one shot).

Operating Lease is a transaction where a vehicle is leased to a corporate Lessee with no capital outlay required. An arrangement where the Lessor grants the Lessee use of an asset/vehicles during a specified period in exchange for a rental fee. Lessor – HERALD (financier of the asset. Lessee- Customer, user of the asset).
Standard contract adjustments rules (e.g.: cost per kilometre written on each quotation). Fleet Management Service such as SMR, Tires, RSA, Insurance & Accident Management, Replacement Car, Customer Service Hotline, etc. are offered as a package to the Lessee.

Taxation and registration
The structure of the Operating Lease require the OEM Dealership sell the car to the Lessor and issue the VAT (16% deductible) Fapiao to the lessor. The car will be registered under Lessor’s title using Lessor’s license plate. Depend on the payment schedule, lessor will issue respective VAT Fapiao (16% deductible) to the lessee. At the end of the contract, the lessee will return the vehicle to the lessor. 
The purchase tax is calculated as (MSRP *0,9) / 11,7 and has to be paid by the Lessee (included in the Lease or paid one shot).

In China to offer Financial Lease, the Lessor needs a Business License delivered city by city.
As of today, HERALD can offer Financial Lease in 57 cities.

Same approach for Operating Lease, the Lessor needs an Operating Business License delivered city by city.
As of today, HERALD can offer Operating Lease in 29 major cities.

8 cities have restiction policy to decrease the traffic (Hainan in addition, official in 2018).
By doing so, individual and corporates need to have a license plate delivered by the local authority for each running vehicle in those cities:
 

150.000 plates per year evenly distributed to every month. The breakdown is 60.000 EV plates, 90.000 normal plates.
Base lottery winning percentage for the first 24 rounds per individual. If not won, from 25-36th round, winning probability doubles. If still not won, from 37-48th round, winning probability tripples, and so on.
The application process is similar to lottery, but so far 100% probability of winning. So far around 80% of the plates are already won by individuals. Forecast will be used by April 2017, so awaiting new development.

In February 2017, 10.175 individual plates and 1.194 corporate plates were auctioned.

100.000 plates every year evenly distributed to every month. The breakdown is 10.000 EV plates, 50.000 normal lottery, 40.000 auction. 88% are individual plates and 12% are corporate plates.

100.000 plates every year evenly distributed to every month. The breakdown is 20.000 EV plates, 40.000 normal lottery, 40.000 auction. 88% are individual plates and 12% are corporate plates.

80.000 plates per year evenly distributed to every month. The breakdown is 80% normal lottery, 20% auction. 88% are individual plates and 12% are corporate plates.

120.000 plates per year evenly distributed to every month. The breakdown is 10% EV plates, 50% normal lottery, 40% auction. 88% are individual plates and 12% are corporate plates.

For families that did not win the lottery for 2 years in a row, the family can apply and receive license plate.

Herald International Leasing (Alphabet)
26^th Floor, Tower A, Gateway Plaza
No. 18 Xia Guang Li North Road, East Third Ring
Chaoyang District
Beijing 100027, PR China