How much per mile to make a l/p work?

LS is not going to hire you, at least for a few years.

 

while this is the way to do it, you need 2 or 3 years driving before a good company will lease you on. They have much stricter standards than those starter mega carriers

 

I'll probably buy a big Pete and lease on to landstar when I retire. I'll leave it sit until I decide where I want to go. The $$$ has to be right though.

 

Yeah, but they won't lease you on until you got a couple of years of experience. Plus, you need those two years, perhaps more just so you can get acquainted with the trials and tribulations of what you are about to get yourself into.

 

Of course, you can skip all the trials and tribulations and save the taxpayers money, sir, if you would just take the deal and plea Guilty.

 

Nope not at all, when the new truck you are in breaks it is normally under warranty, the company will with hold as much as you want them to so you have a maintenance fund, if you go in the hole with the fund it comes back with each weeks settlement till it is adding to it again, they have all of this stuff figured out, For example JCT takes a certain CPM out every week.

Andyes this is in addition to my $.42 CPM that I am taking out of it! all L/P's deals are not to screw the drivers.

 

I really don't see how people can make money on lease purchase deals. To make those work you need to run many miles. I see people figuring there income at 3000 miles a week. Not every week your going to get 3000 miles. Put into consideration your maintanance with that many miles. Good tires are $4000, fuel went up and here in CT we pay $4.55-4.65 a gallon. So lets break this down. .95cpm + .45 cpm fsc x 3000 miles/week=$3900 fuel @ well say $4/gallon 6mpg= $2000, maintanance@ .10= $300 weekly truck and insurance $700. right now your at $900 for a week of busting your ###. plus other expenses that company charges and you will have breakdowns and repairs. Those payments are still die when you take time off and during slow periods. Oh and taxes. So is it really worth being a lease op just to say you have your "freedom"

 

A couple of problems with your example. Starting with fuel, the national average for fuel isn't $4 and even if it was its drastically effected by certain very high priced areas of the country. If I'm a smart guy thinking of doing an L/P I'm certainly not stupid enough to get on with a carrier who wants to keep me in those areas. Moving on to breakdowns and repairs, that's what the $0.10 a mile maint contribution is for. As for insurance, every L/P I've looked at only requires bobtail insurance, everything else is covered by the company. Bobtail insurance certainly isn't $700 a month, let alone a week when going through a company plan. Closer to $50 a month.

Lastly, and the part I have to assume is willfully not mentioned, is whatever your take home is in addition to the truck payment and any maint funds left over when you either end the lease or complete the purchase. Last I checked dealerships aren't giving away trucks to O/O's. Nor can an O/O operate without having funds for maint/repairs. It costs $1 per min to operate any truck even if its paid far. If there was a way to prove it I'd bet the average O/O with his own authority making a truck payment isnt making a true bring home much higher than a smart L/P operator.

I'll reiterate my opinion. L/P and O/O are not for everyone. Too many drivers with "company" driver mentality jump into both and fail. Too many companies doing L/P for drivers who barely have the experience to back a truck too. Just as bad are the companies doing L/P without the miles to support the leasee. Any driver who takes a lease with a company like that didn't do his homework, effectively proving they don't have the business sense required to lease or own a truck.

 

Run away fast!

Fuel will cost .50 to .60 with discounts, the truck, maintenance, insurance, etc. will cost at least .60. Then you need a wage. A good company job should pay .40 at minimum. That's about $1.50 and could be higher. Expenses don't come in a smooth fashion. You could be out several thousand any day without warning, so you need cash on hand to stay in business.

How much do they pay for fuel surcharge? Those pay rates they quote don't include it, I hope. I'm guessing it's about .51. So, .51 fsc + .96 linehaul rate is $1.47. Now, is that pay rate on all miles or just book loaded miles? 20% deadhead would cut that down. If you're making $1.47 on paid miles loaded, with 20% deadhead(including 5-10% loss on difference between actual and book miles) it becomes $1.19! Can't make that work, and if it is $1.47 you gross on all miles, then you have a situation where your wage is .37/mi on all miles.

If the company has ways to cut your expenses, like $50 shop work and deep discounted fuel at terminals, you might make as much or a couple cents more than a company driver. But is it worth the capital investment? I think not.

These lease purchase "deals" are created to shift all the equipment risk to the driver, reduce turnover by trapping the driver, and not have to raise wages in order to accomplish these improvements to their corporation.

It's a really sweet deal for them; not so sweet for you.

 

Buying a truck is not like buying real estate. You are not putting equity in something that depreciates. It more like a perishable fruit. You eat that fruit before it rots. Or with a truck, you drive it up and hope you get good rates for the miles you do.