← Lessons 16. Contracts and Conditions of Carriage
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1. INTRODUCTION 2. OWNED TRANSPORT 3. HIRED TRANSPORT 4. CONTRACTS OF CARRIAGE 5. FREIGHT FORWARDER 6. CLEARING HOUSE 7. SUB-CONTRACTOR 8. GROUPAGE OPERATOR 9. AGENTS 10. CONCLUSION 11. Quick Exam Numbers / Facts – Memorise These 12. Final Memory Checklist

2. OWNED TRANSPORT

  • Owned transport means a vehicle or vehicles owned by a business.
  • Vehicles may be acquired by:
  • Direct/outright purchase.
  • Hire purchase – agreed payments are made to a finance organisation over an agreed period; after the final payment, the vehicle legally belongs to the operator.
  • Vehicles form part of the owning company's fixed assets, whether bought outright or by hire purchase.
  • Advantages:
    • Complete control over vehicle specification and construction.
    • Complete control over use and eventual disposal of vehicles.
    • Can help provide a more reliable service to customers.
    • Adds to the fixed assets of the business.
    • The operator can benefit from capital allowances against tax on acquiring vehicles.
    • Allows the business to brand its transport service through vehicle livery, employee uniforms and similar features.
  • Disadvantages:
    • Company capital is tied up in vehicles and may have been more useful elsewhere in the business.
    • Cash shortages may make vehicle replacement difficult.