Big opportunity For CR England Lease Operators? Merged 3 threads

Thanks, BigBadBill. Mine (not CRE) are in storage in another state. Yes, they very definitely are a take-it-or-leave-it deal.

Still, I don't think that all the failures result from idiots not reading before signing. Surely, some must be. But how could anyone succeed hoping to run 163,000 / 171,600 paid solo miles a year three years in a row? Not possible under 8/10 HOS or even the 2004 and later versions. Not possible on many other levels too. And any number of carriers have 1) failed to disclose various lease wrinkles 2) exceeded contracts with undisclosed and unauthorized chargebacks, so it's off to court they go.

Safe Trip.

 

This guy has already decided to go for it he just needed a nudge, BBB tipped it in for him, I say good luck, you're going to need it.

BBB is the exception if what he says is true. Fleece purchase programs are nothing more than modern day share cropping, the 'land owner' never loses and the odds are against you.

 

Failures are less about not understanding the lease but more about not understanding anything about business PERIOD. Forget about all that these people don't know about trucking (and that is a big factor). But so many of these people don't even understand how to calculate MPG or read a settlement. You could take away all the fixed payment and they would still fail.

 

First off why would anyone want to drive a team truck and only make $.42 a mile I wound never do it unless you get $.62 a mile and that's each driver not both
They do this lease to get out of paying workmans comp and taxes they send you a 1099 at the end of the year and that $357 a week is not going to cover tires or major repairs I think it's a smart idea on there part but stupid on any drivers part I talk to a guy one time he never Finnished it he told me the truck started having problems and was in the shop a few times so he started getting behind on payments ect so they said they could put him in a newer truck so he did it and started all over again

 

Why? Because the other option is to be a company driver at less than $.30/mile on 2500 miles a week or train at 5000/week at $.40/mile (to the person leasing). That like $1200 more a week.

That is the incentive.

Now few do this not because the opportunity is not there but because they do not meet the service level requirements to get onto accounts that will give them these miles and/or safety records keep them from becoming trainers.

As far as repairs go that comes to my point that people are doing this with no clue. $.07/mile for maintenance? They only save and plan for 30,000 mile PMs (with no samples to see of they can go that long) and tires. And then they don't get the life they expected from the tires because they run them low, are running crappy caps, don't have alignment checked. Do you think an O/O that has bought his own truck is going to treat maintenance the same way? If they do they will be out of business just like the lease guys are.

There are plenty of O/O's with same fixed expenses making the same rate as a lease op that do just fine (OK, they still make crappy money). What is the difference? They have a clue about what it takes to maintain a truck.

If you are using the correct numbers the math works. Forget who the payment for the truck goes to. A payment is a payment. If you can't make it work with a walk away lease then you can't make it work making the payment to the bank.

 

I just recently left CRE after almost five years leased onto them.

First, if you think you're going to make that much money in a lease truck, even as a team, please reevaluate. Take 75% of whatever number or miles they're telling you. Do not believe the 'best case scenario' numbers they throw out as average or expected.

I trained for a while, but was mostly solo. I leased. I bought. I paid off. And despite that, I still left because I wasn't making enough for the work I felt I was doing and the profit I was generating for them. I had never been late due to driver failure (weather/mechanical breakdowns are different issues). Yet, I was always second fiddle to teams. Most of which worried me greatly whenever I'd see them in a truck knowing the trainer probably only has a month more experience on the road than the 'student'.

Secondly, the variable will eat up your revenue if you team. Be aware of that. Secondly, if you need repairs that eclipse your general reserve, they will loan you the money at 14% interest and deduct $150 or so a week until its paid. You have to factor this in. Unless you're lucky and have no repairs for a long time and build up a large reserve, this will not help you.

5,100 miles as a phase 1 (i.e., green students with just a few hours behind the wheel) will net you .90/mi OTR (your gig sounds like a DC-to-store run, I won't name names, I did it as a solo for a while and enjoyed it, but hated driving overnight, just not worth the hassle after a while).

Okay, next is FSC (or rebate), in a new truck governed at 62mph, you'll do better there than on the fuel cap program. Trust me. Just make sure you're fueled up when your next load is on the rebate. FSC varies on the run you do. OTR was at .40 last week. Remember, also, that empty miles are (for OTR) .80 and you run about 10% empty. Now, your dedicated is probably 1.00/mi for every mile. Also, realize that if you follow their routing, you'll be driving at least 10% more miles than you'll get paid for. So, that 5100 (total driven, not paid, will mean probably 4600 actual paid miles a week with no hiccups, downtime, or hometime).

But, for OTR:
Empty Miles $468
Loaded Miles $3726
FSC $1840
Total revenue=$6,034

Now, variable costs:
Variable mileage is a BS charge at 14cpm. This charge has been said to be many things since they've instituted it. And trust me, the people working there now actually believe it's to pay load planners, DMs, safety, etc. But, o/o's don't pay it. So, either my DM was pro bono, or the purpose of the fee is simply to pay you 76cpm without letting you know you're making only 76cpm as a lease-op.

Maintenance is 7cpm, but remember that will not cover anything but routine maintenance. Tires (if they last long enough), oil changes, brakes, etc. Big things will probably be coming out of your pocket if they're not covered by warranty. And do any and all dealership warranties at the dealership. Not at their yards. In fact, do all work at a dealership. There's warranty there. CRE doesn't warranty their work in their shops. Do not find out the hard way. Freightliner will warranty one year unlimited mileage. Anyways, be prepared for big repairs sitting you for a week. Even a new truck will have them. Especially with this DEF crap. Even if it's warrantied. The hotel room will be on you (which they're front you the money for out of your settlement). If you have the means, pay for the room yourself on a credit card. At least that way you're not hit with $350 or so out of your ensuing settlement after being down for a week. This will start a vicious cycle if you don't. But, $150/wk for repairs going above your regular reserve is expected.

Variable $644
Maintenance $322

If you run at 7mpg (I've seen it done at CRE in these new trucks creeping along at 60, remember that's for non-mountain dedicated runs where the drivers are NOT driving a lot of miles, and therefore going very slow to make money. If you have a student, you will not get good MPG. Figure 6.5 paid MPG with a student in mountain driving. And, realistically, think more towards 6.0 paid (which means 6.7 real mpg). CRE has fuel discounts, but be aware that where they send you is not always the best price. If you want some proof, and call the fuel dept. and ask them how they handle fuel discounts. You'll be shocked. But, then you'll realize why they send you to one truck stop that will charge you '3.70' when you see a pump price at another CRE stop that is advertising '3.66'. One is giving a discount, the other is just a cheap price with 0 or hardly any discount. Remember this. If you're not on the cap, do not follow the fuel routing.

Alright, if the DOE national average is 3.86 right now, CRE will probably get you average fuel (non-CA) for about 3.70 or so after their discount on average. And don't just fill up based on the pump price. You need to learn fuel taxes and which state truly is the better deal. And even if you are on the cap, fuel in the high tax states (CA, WA, NY, PA, IL) and avoid the low tax states (WY, IN, MO, OK). There's others, but those are the big ones you'll deal with at CRE. The reason, if you pay $1.25 a gallon no matter what, you might as well accumulate as much fuel tax reserve as possible. Learn fuel taxes as quickly as you can. Don't get nailed with them taking your settlement one a quarter because you didn't know that the cheap diesel in Oregon (pump price) has no fuel tax and you keep driving into California and owe $1000 or more each quarter.

So, $3.70 a gallon on average at the current rate.

Fuel 767g at $3.70/g = $2,838

We're down to $2,230 and we are just now getting into your weekly expenses. First, lose the DSC card and legal fees. You don't need them.

Next, is your truck. New truck is probably $600/wk. No clue, as I leased a truck years ago at a discounted price for being used. And back then I paid $400/wk. I know from talking to new lease-ops its near or at $600 now. Next, is insurance. New truck, your insurance is probably at $200/wk total. Do yourself a favor, contact ANYBODY and get different insurance. A+ rating, $275k BIPD. I went to Progressive (bad in hindsight) and got $3880/year. You still are stuck with the $10k cargo you're required to buy and occupational. Which is about $28/wk. But, I assume you still have CRE's BIPD insurance and are spending two bills for it bundled with the cargo and occupational.

And then we have fees/permits. This is a recent add-on, and is $46.19/wk for your plates and state permits.

Truck $600
Insurance $200
Permits $46
Total fixed: $846

Now, we're down to $1,384 a week. NEVER going home, breaking down, or having freight slowing down, etc. This is pre-tax income. If you went to their school, you have tuition reimbursement. Which, I know is a lot from talking to the newer guys. Probably in the $40-$50/wk range. And then you have your bookkeeping. Which you're probably paying about $40/week for through CRE. So, that's another $80 off the top at least.

$1,304

And we haven't even gotten into the fun part: your student. If you're phase two, it's 10cpm taken out. Phase one takes out, about, $37/day. And if you keep your student on long enough as a permanent co-driver, you have to pay workers' comp for him.

Phase 1: $259 or so
Phase 2: $460

So, $1,045 as a phase 1 trainer. $844 as a phase 2 trainer.

Now, time off. You're down for one week, your weekly expenses would be: $926. If you have a phase 1 student, you're still paying him per day $37. So, if you sit in a hotel for a week, you're down an additional $259. Plus the hotel ($50/day for 7 days=$350).

You're now in the hole $1,535 for one week down with a student in a hotel. You made $1,045. That means you have to drive 10-11 days just to make back the money you lost. If you go home solo, you're down only $926. Which means one week driving just to pay off your expenses from taking a week off.

Now, for your revenue numbers at $1/mi, add on the .20 for the 10% empty and .10 for the 90% loaded. That's 11cpm for the 4600. Or, an additional $506 revenue. There's no additional fees taken out of this. However, be aware that, as I mentioned before, these are 'best case scenario' 5100 driven/4600 paid. I've seen teams on dedicates getting 3,000-3,200 before starving.

Now, with all that said. I did it. I somehow made it through the trouble and sacrifice to own my own truck and just got my own authority and just bought my own trailer today.

But, I do not recommend CRE to anyone for good reason. Luck, more than skill, dictates who survives. Get a demon truck with a lot of problems (company or lease) and you will go bankrupt. Get a bad DM that gets you bad loads, etc you will go bankrupt. You won't even have time to argue and get a new one. You will just be too far down the rabbit hole.

Hope that helps you make a decision.

Now, if you want to go solo.... I pray for you.

 

Thank you, Sly Fox. That's one of the best posts I've ever read: no BS, no cheerleading, no snark, just straightforward facts and numbers. I hope a lot of people read your words and I hope the OP heeds your advice. Good on ya and on your truck and new trailer. Safe Trip.

 

Sly, great post. Good for the OP to see current numbers.

One thing I will say is that there is no such thing as luck. You may feel your are got lucky on this or that but just from this post I can tell you thought threw things.

Good luck on being Independent. I believe you will do great just based on this post.

 

Is this thread a joke? Is that seriously what these big company lease purchases look like? All I can say is, WOW, I am in the wrong sector of the industry. I need to get into the truck leasing business.

 

Thank you, BBB. I do know my perseverance and drive helped me through my time there. And, I've been planning on leaving for almost a year. My truck is getting older and I want to get as much as I can out of her before I need an overhaul.

In the past year with no truck payment, I've replaced a transmission ($6700), a front differential ($2750, for used), radiator ($1600), kingpins ($1300), and then minor stuff. Airbags, some air line connections. But, I've had no truck payment. So, maintenance is all I've had to pay for. But, that's what you get with a truck reaching seven-figures on the odometer.

Would I like to go back and stop myself from going to CRE? Not really. I don't think I'd be in the position I am in now otherwise. Mentally, at least. Had I gone somewhere easier, made more money, etc, I'd not be getting my own authority, nor I feel capable of undertaking this endeavor. I'd still be driving for someone else.

But, on Wednesday of next week. I will be driving for myself, truly, for the first time.