Haulage Fleet Refinance
How Doulton Bridging Finance consolidated 12 separate HGV finance agreements into a single fleet facility, reducing a Midlands haulier's monthly payments by £4,200.
“We had seven different lenders, seven different payment dates, and seven different renewal conversations happening at once. Now we have one. The saving was a bonus - the simplicity alone was worth it.”
The Scenario
An East Midlands general haulier operating a fleet of 12 HGVs - a mix of curtainsiders, flatbeds, and temperature-controlled trailers - had accumulated finance agreements with seven different asset lenders over a six-year period. The fleet had been grown opportunistically: individual vehicles were financed at the time of purchase from whoever offered the fastest approval, resulting in a patchwork of agreements with varying rates (from 6.9% to 11.4%), terms (24 to 72 months), and renewal dates spread across the calendar year.
The Challenge
The administrative burden of managing seven lender relationships was significant - seven sets of annual renewal conversations, seven insurance certificate requirements, seven direct debits across different dates, and seven end-of-term processes to manage, with monthly total payments across all agreements running at £11,840. More materially, four of the seven agreements were at above-market rates, having been written when the business had a shorter trading history and weaker credit profile. The business was now seven years old with strong accounts, a clean credit profile, and solid trading performance, but the legacy finance costs had not been updated to reflect this improved position. The finance director raised this at a planning meeting and the directors asked Doulton Bridging Finance to review the position.
The Solution
We conducted a full audit of the existing finance portfolio - settlement figures, remaining terms, implied rates, and total cost to run to natural term - which showed a blended effective rate across all seven agreements of 9.1%, significantly above current market for a business of this profile. Three agreements with the highest rates had early settlement figures that made immediate replacement economically viable, while the other four had settlement costs assessed against the saving available from refinancing. After modelling multiple scenarios, we identified that consolidating all twelve vehicles onto a single 60-month facility with a specialist fleet lender would reduce the monthly payment from £11,840 to £7,640 - a saving of £4,200 per month - while resetting all vehicles to the same renewal date and reducing the lender relationships from seven to one, with a total interest saving over the new 60-month term of approximately £96,000.
The Deal Structure
| New Facility | Single HP fleet agreement, 12 vehicles |
|---|---|
| Total Financed | £480,000 (settlement values + associated costs) |
| Rate | 7.2% fixed per annum |
| Term | 60 months |
| Monthly Payment | £7,640 (consolidated) |
| Previous Monthly Total | £11,840 (across 7 agreements) |
| Monthly Saving | £4,200 |
| Settlement Handling | Lender settled all 7 existing agreements directly |
The Outcome
The new facility completed in 12 working days. The fleet lender settled all seven existing agreements directly, eliminating the complexity of the director managing multiple settlement processes, so from completion the business had one monthly payment, one insurance certificate requirement, and one lender relationship. The £4,200 monthly saving was initially directed into clearing a residual overdraft balance, and in month six the improved cash flow enabled the business to add a thirteenth vehicle - financed on the same facility through a top-up mechanism negotiated at the time of refinancing - increasing fleet capacity for a new contract that had been won but not yet resourced.