Paclease Franchise
Audited FinancialsRisk Score
Pending analysis
Investment Range
$454,250 - $904,250
Franchise Fee
$4,000
Total US Locations
417
Business Summary
PacLease franchises operate commercial truck leasing and rental businesses, which also provide maintenance and other services for these vehicles. The primary customers are from the trucking industry who need to transport goods. Most PacLease franchises are typically owned by or affiliated with Kenworth or Peterbilt truck dealerships, and the business may be operated in conjunction with an existing truck dealership.
Corporate History
PacLease is an unincorporated division of PACCAR Financial Corp., which is a Washington corporation incorporated on March 31, 1961. This parent company, PACCAR Financial, offers wholesale truck inventory financing and retail financing for Kenworth and Peterbilt trucks. PacLease itself operates as a franchising company, selling franchises for commercial truck rental and leasing. It also directly rents and leases trucks to end-users and may own and operate its own retail leasing outlets as part of the PacLease system.
Financial Overview
Investment Range
$454,250 - $904,250
Franchise Fee (Low)
$4,000
Franchise Fee (High)
$4,000
Royalty %
1%
Equipment Costs (High)
$75,000
Working Capital
$100,000
Audited Financials
Yes
Offers Financing
Yes
Audit Opinion
Unqualified opinion
Financial Health Notes
PACCAR Financial Corp., which includes PacLease, is in a strong financial position, holding investment-grade credit ratings of A+/A1. The company has sufficient resources and access to capital markets to maintain liquidity and financial stability, supported by committed bank facilities and the ability to borrow from its parent company, PACCAR Inc, if needed. There are no concerns about the company's ability to continue operations.
Financing Details
PacLease offers lease financing for franchisees to acquire trucks and trailers, provided they meet PacLease's credit standards. This financing is typically provided through a Lease for Re-Lease Agreement, usually for a five-year term. For example, a vehicle with an acquisition cost of $130,000 could have monthly payments ranging from $1,685 to $1,875 over 60 months, with no down payment required. As of January 2024, the average Annual Percentage Rate (APR) for a 60-month term is 7.35%. PacLease retains legal title to the vehicle. Franchisees must guarantee a pre-determined residual value at the end of the lease. If payments are not made on time, PacLease can repossess vehicles and terminate the lease, with the franchisee remaining liable for any shortfalls. PacLease may also require personal or corporate guarantees and can assign lease obligations to a third party.
Performance Metrics
Total US Locations
417
Franchised Units
415
Corporate Units
2
Legal & Compliance Analysis
Recent Litigation
No
Bankruptcy
No
Litigation Summary
PacLease has no litigation to report in Item 3 of the FDD, indicating a clean legal history for the franchisor and its management.
Bankruptcy History
PacLease and its management have no bankruptcy history required to be disclosed in Item 4 of the FDD.
Agreement Terms
Initial Term
3 years
Renewal Conditions
To renew their agreement, PacLease franchisees must not be in default of the existing agreement. Franchisees can renew for successive terms of one to three years without signing a new contract with materially different terms, unless PacLease terminates the agreement for cause.
Training & Support Program
Franchisor Assistance
Before opening, PacLease assists franchisees in setting up a standardized accounting and cost control system. It offers a two-day orientation training for the franchisee and staff at its Bellevue, Washington headquarters or online, and provides electronic forms. After opening, PacLease's Area Operations Managers provide periodic telephone support. The franchisor promotes a national truck leasing and rental system, offers ongoing training and consulting on business operations, and helps arrange insurance coverage for leased vehicles. PacLease also provides a marketing program, offers financing alternatives for vehicle inventory (if credit standards are met), protects its trademarks, issues a franchisee directory, inspects business locations to promote compliance with operating procedures, and helps resolve disputes between franchisees.
Initial Training Hours
10
Training Location
Bellevue, WA or online
Ongoing Support
After opening, PacLease provides ongoing support through its Area Operations Managers who periodically contact franchisees to discuss issues and training needs. The franchisor promotes a national truck leasing and rental system, offers continuous training and consulting services on truck leasing and rental business operations, and helps arrange insurance coverage. PacLease also administers a marketing program, offers financing options for vehicle inventory (subject to credit standards), protects its trademarks, and periodically issues a franchisee directory. It promotes compliance with Standard Operating Procedures through personal visits and inspections and assists in resolving disputes between franchisees. PacLease also conducts annual seminars, offers specialized training for maintenance/service managers, provides on-site sales and service training upon request, supports ASE Certification for mechanics, and offers courses through PacLease University in sales, rental, maintenance, and franchise management.
Franchise Requirements
Ideal Candidate Profile
PacLease primarily seeks franchisees who are already owners of, or affiliated with, a Kenworth or Peterbilt truck dealership. The franchise business is often operated in conjunction with an existing dealership. Alternatively, PacLease may offer franchises to parties who are not affiliated with these dealerships but already own and operate their own truck leasing and rental businesses. For those affiliated with a Kenworth or Peterbilt dealership, PacLease requires the hiring of a qualified lease salesperson within the first three months of operation. The individual signing the Franchise Agreement for the franchisee must actively participate in the management of the business, whether they are an owner or a designated manager.
Industry Experience Required
Yes
Management Experience Required
Yes
Sales Experience Required
No
Technical Skills Required
No
Operational Details
Location Type
Commercial
Owner Participation
Supervisory
Territory Type
Non-Exclusive
Staffing Notes
PacLease franchisees are obligated to employ a sufficient number of competent and trained personnel who are knowledgeable in the heavy-duty truck leasing and rental business, as well as related service activities, to meet customer needs. These personnel are expected to participate in training programs provided by PacLease. If a franchisee is affiliated with a Kenworth or Peterbilt dealership, PacLease specifically requires them to hire a qualified lease salesperson prior to or within the first three months of operation. Initially, existing mechanics, receptionists, or clerical staff from an affiliated truck leasing business or dealership may be adequate.