CPF, Construction Plant Finance, introduces flexible funding option for new equipment
Welcome to the CEA Member Insight series, where we take a closer look at products and services relevant to members. In this edition, we look at PlantFlex, CPF’s new funding option for construction equipment.
CPF has launched PlantFlex, a funding option for contractors, plant hire firms and owner-operators buying new equipment. Built around a Business Contract Purchase structure, it gives customers a choice at the end of the agreement rather than committing them to ownership from the outset.
Under the agreement, customers make fixed monthly payments for the term of the contract. At the end, they can choose to pay a final lump sum and keep the machine, return it, or use any available equity as a deposit towards a new one.
CPF says PlantFlex can be used on any brand of new construction equipment, including excavators, dumpers, telehandlers and rollers. This means buyers are not restricted to a particular manufacturer or dealer finance scheme when choosing the machine that best suits their operation.
The structure depends on what CPF calls a Guaranteed Future Value (GFV): an agreed value for the machine at the end of the contract, set before the agreement begins. Because that value is fixed up front, CPF assumes the residual-value risk if the machine is worth less than expected in the used-equipment market at the end of the term, provided it is returned in line with the agreed-upon hours and condition requirements.
The GFV also supports lower monthly payments than a standard Hire Purchase agreement for the same machine, because part of the cost is deferred to a final balloon payment rather than repaid over the full term. Ownership is not automatic; the customer owns the machine only if they choose to pay the final balloon payment.
Returning a machine under PlantFlex is subject to fair wear and tear and an agreed hours limit. CPF says any additional charges for exceeding those hours are discussed and agreed before the contract is signed.
This puts PlantFlex in contrast with Hire Purchase, the format most contractors will already know. Under Hire Purchase, the customer’s approach focuses on paying for and ultimately owning the machine. PlantFlex gives businesses the option to decide at the end of the agreement whether to retain the equipment, move to a replacement machine, or return it.
The product may particularly appeal to plant hire businesses that regularly refresh their fleets, as well as contractors and owner-operators seeking predictable monthly costs and greater flexibility in future equipment requirements.
Steve Moody, Consultant CPF, Construction Plant Finance, said: “CPF PlantFlex gives customers a practical alternative to traditional Hire Purchase when funding new construction equipment.
“Not every business wants to tie up capital in a machine or take responsibility for its future resale value. PlantFlex provides fixed monthly payments, an agreed future value at the outset and clear options at the end of the agreement.
“Customers can keep the machine, return it or move into a replacement model, while retaining the freedom to choose the equipment and manufacturer that are right for their business.”
PlantFlex is available through CPF, Construction Plant Finance. For further information, call 02382 352506 or email newbusiness@constructionplantfinance.co.uk.
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