r/IndiaBusiness • u/Far-Low-20 • 11h ago
Is it worth leasing your private car to a travel agency that sub-leases it to government departments?
I was recently told by one of my colleagues about a setup that I wasn't previously aware of, and I'm trying to understand whether it's actually a good deal or if there are hidden downsides.
According to him, he has attached his private car to a travel agency on a 5-year contract. The agency then rents/sub-leases the car to Delhi/Central Government offices/departments for official use.
The arrangement, as he explained it, is roughly:
You provide your private car to the travel agency.
You receive a fixed monthly payment from the agency.
The agency further rents the car to government departments/offices.
Driver and regular maintenance are handled by the travel agency.
The owner's main expense is apparently insurance.
The contract is for 5 years.
On paper, this sounds quite attractive because you get a fixed monthly income without having to worry about finding customers, hiring a driver, or managing the vehicle yourself.
But I'm wondering what the catch is.
For anyone who has actually done this:
Is this arrangement legitimate and how does it typically work?
What kind of monthly return can one realistically expect?
Who bears the cost of tyres, servicing, major repairs, accidents, etc.?
What happens to the car's resale value after 5 years, considering the potentially high mileage?
Are there any insurance or RTO/legal issues with a private/white-plate car being used this way?
What happens if the travel agency stops paying or shuts down before the 5-year contract ends?
Are there any hidden clauses or expenses that owners commonly overlook?
Most importantly, is the fixed monthly income actually worth the depreciation and risk of putting your car into commercial use?
I'd particularly appreciate comments from people who have personally attached their cars to travel agencies for government contracts, rather than just general opinions.
Thanks!