Average rates for O/O

Discussion in 'Ask An Owner Operator' started by Justtruck, Nov 30, 2021.

  1. Justtruck

    Justtruck Bobtail Member

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    Hello all, excuse my ignorance but all I know about trucking is what I read. A very good friend of mine has been a company driver for a couple years now and wants to get a truck to lease on to Landstar or Mercer. He went though a divorce so his credit is in the dumps and he wants me to help him get a truck. He is averaging around 3,500 a miles a week as a company driver and is telling me he can average around $2.50 a mile as a O/O driving the same amount of miles so he thinks he won’t have any problem making the payment. My concern of course is me losing a good amount of money helping a friend out. From what I read rates are artificially high currently so did not know if that $2.50 a mile is something that’s going to drop significantly leaving me stuck paying for a truck I don’t have the authority or skills to drive. Thanks for any input and thank all you guys for keeping the world running.
     
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  3. Vitkouski

    Vitkouski Light Load Member

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    Beaver9 and Pamela1990 Thank this.
  4. Justtruck

    Justtruck Bobtail Member

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    Nov 21, 2021
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    Thank you for the link. He showed me his business plan with projected expenses and it makes sense as long as he averages around 3,500 miles a week at $2.50 a mile but I have no idea how realistic that rate is for the long term. Know the guy for 20 years and would love to give him a leg up in life but not at the risk of messing up my financial future.
     
    Pamela1990 Thanks this.
  5. lester

    lester Road Train Member

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    Don't frigging do it! There's hundreds of threads here on guys doing similar and they almost all end the same. No longer friends and shorter on money
     
  6. tallguy66

    tallguy66 Medium Load Member

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    I wouldn’t figure running 3500 miles a week as an O/O unless it’s true long haul
     
  7. D.Tibbitt

    D.Tibbitt Road Train Member

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    Theres much more to this business than running 3500 miles at 2.50 a mile. That is a plan destined to fail. If you are essentially loaning money to this guy. Then you need a contract between the 2 of you to protect you from getting f'd which is a 99% possibility of happening. I would also reccomend the truck is used as collateral for the loan so when ur buddy fails you atleast you have a truck you can sell off after its all said and done and hope you can break even. Which isnt likely to happen. Also you will have to find a new friend because once his bad business plan goes south , he will skip town and never answer another phone call from you.
     
  8. TallJoe

    TallJoe Road Train Member

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    3500 miles a week, every week, is very demanding on a human body and mind.
    Doing it with an average of $2.5 all the time cannot be guaranteed either. Rates on longer distances may drop below 2 dol from one week to another.
     
  9. Pamela1990

    Pamela1990 Road Train Member

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    Don't do it!
    Lending a friend $5 because you went out for a beer and he is a bit short, sure do that, he is your friend.
    Lending him the money for a truck, well that's the end of the friendship, and your going to be kissing your money bye bye.
    Do both of you a favor, and don't do it.
     
  10. BennysPennys

    BennysPennys Medium Load Member

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    Something is fishy about your friends story, he has jacked up and ####ed his personal credit because of a divorce and can’t earn his way out of his problems driving on his own working for someone else. So, he comes to you a friend who has no experience lending or making investments in the trucking industry.

    There is a reason that banks, lenders and people who are in the business of making investments in this transportation industry only make bets on people who can solve their own problems and are responsible for their own good credit. They want their investments back with lots of money returned on top of that. Because this is a risky business that has lots of variables in it such as the cost of diesel, the amount of income earned on freight lanes changing weekly, very high insurance rates, factoring rates on getting paid on loads faster, not keeping the equipment up and running, and something that seams as simple as tires can make or break you in this business.

    Never loan money to a friend in less they put up collateral that you will hold on to and is worth 2x what you give them in a quick liquidation sale.

    It is good that he has a business plan but before retiring I was in the business of backing startups and growing business and I put about three dozen good business plans in the shredder a week.

    Pamela1990 gave you some good advice: Don’t Do It. And she knows 10 times more then I do about the Transportation business then I do.
     
    Last edited: Dec 1, 2021
    dwells40, Pamela1990 and GYPSY65 Thank this.
  11. Diesel Dave

    Diesel Dave Last Few of the OUTLAWS

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    Did he include the losses when the truck breaks down cause it will happened a lot, especially with the newer emission engines. Also, are you aware about parts shortages, truck have stayed in shops for weeks and months due to the shortages, and you still have to pay for insurance truck payment etc. Use the search button on top, lots of horror stories and good ones as well. I personally would never do it(lend) money to a friend nor family member for there business adventure. I’ve know to many that have lost there friendships over this even know a few friends that have lost family ties cause money was loan to a family member. Goodluck if you do.
     
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