Renting a bus on a daily, weekly, or monthly basis offers the most flexibility for the artist that has an inconsistent or unpredictable tour schedule. Although the rental payments for a month on a rented bus are much more than the note payments on a purchased bus, there are zero bus costs during months when the artist is not on tour for a rented bus. Checks written for a month of rent can be about twice the monthly note payment for the same bus. Of course, when you add insurance, repairs, and other ownership costs, the monthly costs of ownership come closer to the rental tab, but are still quite a bit less. The added advantage of convenience tops off the cost savings advantage of a purchased bus.
For an artist with a consistent tour schedule for a several year period, the costs of owning a bus will be less than renting. If the artist changes the business plan resulting in less touring however, a month or two of fixed note and insurance payments for a purchased bus can quickly erase the cost savings advantage of ownership and the artist may wish that he or she was instead renting and could give the bus back for a month or two. Besides business plan changes (label, etc.), family changes such as marriage and kids can change a consistent tour schedule into an inconsistent one. If the artist tires of the bus too quickly, that can also be a disadvantage of purchasing.
Other costs such as fuel, routine maintenance, and driver costs are the same whether renting or buying. The bus should also not be personally owned or rented by the artist, but by a touring entity offering limited liability protection such as a corporation or limited liability company that is owned by the artist.
For the artist with a consistent tour schedule, he or she should consider a five year equipment lease through the equipment leasing division of the bank, instead of a purchase. The main, maybe only, advantage is that there is no down payment as there is with a purchase, which can be as high as 5% - 25% of the purchase. The amount of the monthly payment on a lease will equal the payment it would take to pay down the purchase price to an amount equaling 30% of the purchase price over five years at a calculated interest rate. Basically, you pay the down payment on the back end. The interest rate is based not only on the age of the bus and on market rates, but on the federal tax depreciation rates available to the bank (the bank actually owns the bus) in effect at the time of purchase. At the end of the 5 year lease, the artist is obligated to buy the bus from the bank for the 30% balance. The artist can either find financing and purchase the bus, or find a buyer. Either way, the artist is obligated to pay the 30% balance. So, five years of $8,500 monthly lease payments on a $575,000 bus would pay down the balance to $172,500. Unless the artist overpaid for the bus in the first place, the bus should be worth more than the lease balance.
So, you really have to do a good job of predicting your business model over the next 3 – 5 years and lay out the numbers on a spreadsheet under the 3 options to see what is best for you. At the rental end of the spectrum, you have higher short term costs, but less long term risk. At the buying/leasing end of the spectrum, you have lower short term costs but more risk in the long term.