Leasing and finance
spot lease
A spot lease is a short-term lease priced to current market conditions. Port Economics says short-term leases are also called spot market leases because the price is strongly influenced by supply and demand. The lessee gets equipment for a short, defined period without a long commitment.
Why it matters
An operator might use a spot lease to cover a one-time surge, such as a seasonal rush or a large job. The rate is often higher than a term lease because the lessor takes more risk. A common mistake is to use spot leases all year. The higher rate then costs more than a longer deal. Operators should watch market rates, since a spot lease can be cheap when units are plentiful and costly when they are not. They should also read the return rules and ask how early the lessor wants notice. Terms vary by lessor, and a spot lease may not guarantee that the same unit stays available if the plan changes.
Read: Buying containers wholesale: A buyer's guide for operators
Definition source: porteconomicsmanagement.org
Related terms
master lease
A master lease is a framework lease between a container owner and a lessee. Triton says its master lease suits companies that scale a fleet up or down with demand and need flexibility to pick up and drop off units. Exact terms differ by lessor, so each contract needs a careful read.
term lease
A term lease is a lease that runs for a fixed period. In container leasing it is often called a long-term lease. Triton describes long-term leasing as renting containers at a daily rate for a set term, with fleet costs fixed. At the end, the lease can be extended or the units returned.
per diem
Per diem is Latin for "per day." In container leasing, it is the daily rate a lessee pays for each day a leased container is on-hire after any included free days. Lessors use it to price short and flexible leases, and it adds up quickly on idle units.
drop-off charge
A drop-off charge is a one-time fee for returning a leased container to a depot. One Way Lease describes it as the fee at the destination depot for accepting the unit off-hire. It is lower where demand for re-use is high and higher where the lessor has too many empty units.
on-hire
On-hire is the point when a lessee takes possession of a leased container. One Way Lease says the condition is documented on the equipment interchange receipt, and the on-hire record starts the clock. The term comes from container leasing and applies to similar equipment deals.
off-hire
Off-hire is the end of a container lease when the lessee returns the unit. One Way Lease describes it as the return process: the depot does a condition survey, the lease closes and the unit comes off the lessee's books. The term is common in container leasing.
For the industry
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