Is The Lease Purchase Model Worth Saving?

Honestly....no. Leaseing a truck from the same people who control every aspect of your money, that truck, your pay, what you haul and everything else is a moronic move.

There is a reason for every member we see here who has payed off their truck and moved on. There are at least a thousand who fail. And the ones who do succed only do so because they are lucky and have a truck that never fails, are at ethical compamys or are just that good. So we either need to outright kill the practice or heavily regulate it by making many things vastly more transparent. And this is coming from the dude that hates everything big brother.

My fear however, is that people will conflate leaseing to and leaseing from a carrier and get the former banned along with the latter. Even though the former is often a good deal and little diffrent to just getting an exclusive customer with certain agreements. You can even leave if required and make a better living elsewhere if the carrier really screws you.

 

All agreed apart from your third paragraph - the language of ‘lease’ as in ‘lease purchase and leased to a carrier’ needs delineation in the industry -

The contracts at the very least , for a lease PURCHASE - need regulation. And I hate to say something needs regulation, but I see too many fools have their futures ruined by predatory agreements.

 

The operative word there is fools ... the issue with the lease purchase model is that they give the other wise incompetent the opportunity to hang themselves.

If there is to be any regulation, it should be that carriers be required to screen candidates for a moderate level of business understanding. Or require the candidates to provide a business plan ... much as a bank would require when requesting a loan or line of credit for a startup.

 

When you do a lease purchase you are at the mercy of the company you’re working with

if they are ethical
And have plenty of direct freight , then it can work out good

I started out with a lease purchase , I had no driving and no trucking experience at all , but I was was a fast Learner and a hard worker and a decent shade tree mechanic , and the company I was working with had plenty of direct freight and had no company drivers that I had to compete against

the company was using outside drayage when they had more freight than the lease operators could handle and the outside drayage was very expensive .

I had no trouble paying off my truck in two years and saving a bunch of money to buy a nicer one , and saving for a down payment on a house .

 

49 CFR § 376.12 - Lease requirements. It may not say too much about the leasing of a truck from a company per se, but it does state a lot about what failed lease ops come on here saying about not being paid and so forth. There is a lot that most who leased and failed (me included at one time) have thought to themselves, oh the company kept my money, etc.

Edit: From the link the OP posted in the article it says "The reality of this labor market is that we’ve had fraud laws that they aren’t able to take advantage of and haven’t stopped these practices." I think they should scratch "aren't able to" and replace it with "don't".

 

These predatory "lease purchase" arrangements are one thing that allows mega carriers to artificially lower their rates and be more competitive than a legitimate carrier with real costs. If they've got empty unutilized equipment that they can't or don't want to seat with an "expensive W2 employee" what better way to get rid of that cost than to shove it off on some dumb fool 1099 "employee" that doesn't even read the contract they signed? And the company can run those particular trucks cheap too, cut your throat and take your freight.

 

Not a slam but try that with Prime or Baylor or any other mega. You were lucky. When I first started driving Burlington Motor carriers out of Daleville Indiana tried to get me to fleece on with them. They made the class mandatory, I said I don't want to fleece. They said I have to sit through it, I said okay. Started asking tough questions and asked to see the contract so my lawyer friend could read it. They told me you can leave now.

 

Following

 

Company?