Freight Volume during COVID19

Leasing equipment can be smart and leasing to a carrier can be smart. Lease purchasing equipment from the outfit you're leasing to cannot be smart.

 

That's a good idea. Trucking companies don't offer L/Ps out of the goodness of their heart.
They're in business to make money and if they made more money with strictly company drivers that's the way they'd go.

 

Get this picture squarely in your mind:

When you borrow money, ANY KIND of money, credit card, home equity, LEASE.......any kind of loan..........
You get/you AGREE to this big 'ol brass hog ring in your nose with a very strong chain attached.....got that picture in your brain???????

BECAUSE,
Now you have "GOTTAS".
GOTTA make that minimum payment by the 12th.......GOTTA do whatever I gotta do to make that payment! You've just worked yourself into a corner..........
Can't make the payment/don't have a cash reserve to draw on???????
OH, I'll just take a quick advance on the credit card...now you have cash advance fees, interest, etc AND ANOTHER GOTTA.......another date and payment...........
Get an advance on the load you just dropped??? Pay 3% and more....
Load pays $1G, you get $970.00...
well, it's only $30 bucks you tell yourself......but that's $30 bucks you worked hard for that SHOULD BE in your pocket !!
Brokers know this game and use it to manipulate you. The Company you're leased to knows this game and use it to their advantage.
Remember that big 'ol brass ring in your nose??.......nah, ....you forgot about that, you got comfortable with it being there, BUT you're getting jerked around like a puppet AND YOU DON'T EVEN KNOW IT!! Never saw it coming, all you can think about is the GOTTAS you gotta do.
Let's say you make it through and get the truck paid off......What have you got???? A used up old truck that ain't got much of any usable like left in it........and you nerver saw any of it coming down the pike because you were too busy running miles to just keep your head above water.

PERSONALLY, I'd scrub toilets and mop floors before I did THAT to myself. BUT, It's YOUR life, YOUR choice, .... Ain't America GREAT !!

 

Use a lease purchase to learn the business. Do not do a lease purchase on a mileage pay . U need to be getting paid like an owner op . Percentage of linehaul, 100 of fsc, 100 of all accesorial pay . Be able to book ur own loads and ur company should have its own freight as well. If u cant do any of those then it will help u none. I am 6 months into a lease purchase under the terms i just mentioned and hanging in there . But i fully expect to be on the road all summer to stay alive. But if u just want ur own truck it is better to save up and buy one because u will pay way more than its worth in a lease purchase ..
if u are only getting paid mileage and under forced dispatch, then u will never gain any knowledge of the business or be able to build relationships with brokers outside of ur company , and those are the relationships that u can use when u decide to leave ur company, and go out on ur own.

 

I chuckled because I got to thinking about a quote that says, "A person only seeks advice when they already know the answer."

 

Who were you thinking of leasing with?

 

I'm a company driver. I've thought about the OO route some years back. After crunching numbers, and seeing what it costs to maintain a reliable truck these days, I'm not sure if it's worth the effort. A previous poster says you need 10k in the bank. I'd say more like 30k. A serious enough breakdown can wipe out 10k real quick. I think drivers make more money driving someone else's truck. There will be others that dispute that, but they are probably in the upper 10 percent who's take home is more than the 60k average after expenses. However, if I were going to do it, I wouldn't do lease purchase. I would buy the truck, then lease on to the company, much like the Landstar model. You'll have run your own equipment there. You get on a lease purchase, its definitely a tall order to take home any money. You'll have to run huge miles, and that ain't always feasible. The truck note alone is a killer. You said 5000 per week that LP operators gross.... these days, that seems ambitious. I would think somewhere between 3000 to 4000 is more of the norm. You have to think, to when they promote these LPs, it may be 1 or 2 drivers that gross 5000 per week. That's if their model is paying an actual rate minus a percentage as opposed to $1.05 per mile.

 

What I usually tell people is that you have to want to own a truck simply for the freedom of taking that truck wherever you want, or getting your own authority and being totally independent. If you’re doing it just because you think you’ll make all this money, well that’s the wrong reason. If you have a year with above average maintenance costs you will make far less than a company driver.

I own a truck and I’m leased to a carrier in a somewhat niche segment. It’s not worth it to me to pursue my own authority because I make more when it’s all said and done at my current job than I would working the load boards. Do I have complete freedom? No. But I do have quite a bit of freedom, currently in the middle of taking 6 weeks off for a house remodel project.

Never would I entertain the thought of a lease purchase from a carrier that controls when and how much you work. You won’t see the title to that truck because they will starve you out before that point so you’ll turn the truck back in.

 

Same reasons most people work as opposed to starting their own business I suppose. Starbucks doesn't offer their baristas the chance to operate their own Starbucks. If they did, I would still assume that most baristas are ill equipped to run their own coffee shop business. Being able to operate a truck does not necessarily qualify one to run a business.