How do you evaluate if a lease is a good deal?

If you're talking a lease purchase, my brain is the resource that lets me know it's a ripoff. It doesn't matter the company, the truck, or the contract.

Yes, people have done it and will do it successfully, but I'd say for the most part you're just effing yourself, and if you’re not in the position to buy a truck of your own, there's a reason.

You're taking on owner operator responsibility with someone else holding the purse, holding the paycheck, and deciding what work gets done when.

I mean, how can this sound like a good deal?

 

I think they are selling a dream. Who doesn’t what a new truck and be their own boss ? The problem is the trucking company set the price of the truck and controls everything. What if the only load available is going to NYC ? Do you go pay tolls bridges your self and fight the traffic and no place to part truck ? The tolls in northeast are crazy high

I think this the scam they don’t tell anyone. They buy trucks then lease them to drivers. Then sell the truck at about 450,000 miles. If the guy leasing the truck pays $1,300 a week thats $67,600 a year for 3 years that’s $202,000. Give or take, if they put APU on truck that $14,000. So if the truck new is $180,000 plus $14,000 for APU it’s a$194,000. Plus they add the extended warranty for 600,000 miles that that’s basically covers the engine maybe emission stuff for another $13,000 your right at $205,000 give or take.

You lease the truck making the weekly payments if luck you finish the lease you might get a big bonus of money back if you actually finish the lease and you can lease another truck. They take you old truck and sell it as a used truck.

You basically paid the entire truck cost for them. The truck still has lots of value as a used truck. They fix anything that need fix and put on new set of tires and sell the truck used at about 450,000 miles. They sell it for about $60,000 . That’s all profit for them because they got you to pay for the truck as weekly lease payments. Imagine you got a fleet of truck you could make some good money on selling used trucks if you can get lots of driver to lease a truck from you. So let’s make them walk away leases you got nothing to lose if you don’t like it as new driver. You as the company just need to keep drivers leasing the trucks to make those payments. They will lose money on some but they have a fleet of trucks

I also heard if you buy 100 trucks at a time from Freightliner they will give you a$10,000 discount just because they can save money building 100 truck all the same. I got this info from Fitzgerald Glider truck. Back when they selling glider kits truck they said they only order trucks 100 at a time to get the $10,000 discount per truck

 

If you are a driver with less than a year’s experience and your company is trying to sell you on a lease, beware.

If you have to become a trainer to turn a profit ( I didn’t say make a paycheck m I said make a profit..there’s a huge difference. If it’s not profitable, run. If you don’t know the difference, they’re trying to screw Uranus.)

If your net pay is exactly the same as it was when you were a company schmuck, you got F _€Ked. The company convinced your dumb arse to pay all the bills and pay for your own job.

If when pulling into a company terminal, the mechanics in the safety lane can inspect your truck without your permission, order repairs, or charge your maintenance account, they can and will clean you out at will. Be very afraid. Then again, if there’s anyone with grease on their nails that can look at their computer screen and see how much money you have available, bet on them robbing your maintenance account.

If you have to use 1 shop, and only 1 shop for PM services, as required by your operating contract, it’s a rip off.

If you can’t pick and choose what tires you want on the truck when you want them, run.

If every time you go home for a day or so after being gone a month, and it takes you 2-3 weeks to dig out of the hole to see a positive number on your settlement, you are a slave.

 

Its a combination of things. First you have to understand the industry. What I mean by that is you need to understand costs. Tolls were just mentioned, but you also gotta understand the various taxes, fuel costs, permits, maintenance, everything that costs to operate a truck. The costs of a truck are there whether you're driving it or parking it. The costs don't stop. All of that will probably be in the lease agreement you sign. Lots of deductions to the point of where you really can't take too many days off. After all of those deductions, your pay most likely won't be any better than a company driver's pay, i'd even daresay it's worse. Some guys do get through the lease, but 98 percent won't. Ik my opinion, lease purchase is a scam. It's similar to buying furniture at Rent A Center, Aaron's and such. Those places overcharge impatient people to have material things, the look of stability. These companies overcharge drivers to have the look of owner operator, but in reality you're a company driver minus the benefits.

Most importantly though, the fact that you're asking this question is telling me that you have doubts and your mind is potentially telling you this isn't a good idea.

 

If your not in control of the business freight allocations, payments and decision making your no really an owner just a liability. Control is key in business so, if you have to make payments, fuel expenses maintenance on a truck that isn't yours how is that a beneficial situation? The truck is locked in to that company who also controls the freight shipments therefore in hard times they will make sure their trucks with overall expenses are running before yours. So if your lanes of freight are cut, you still have to pay for the truck. All the expenses are on you and unless that truck is paid off 1st you can not change companies with it. Its like being a glorified cdl driver however more of a loss because you now have overhead expenses.

Unless you own the truck outright, of even fiance it or financially lease it through your own lender. You're not in control of your business allocations.

 

If theres more money to be made (and its such a good deal) why would the trucking companys not just keep it to themselves? Trucking companies generally keep the good stuff under their hats

Lease purchases are whack. I think the deal a lease purchase offers is akin to rent-to-own furniture, using money mart, or bad credit financing. Its all predatory

 

Have a lawyer explain the contract and explain pros and cons.
Company I worked for the truck lease payment was based on mileage, worked great if you had a slow month or needed some time off

 

Step one is to figure out who controls the revenue. IE, can the lessee keep the truck if they're not running the lessors freight? If you have to pay a premium (or can't), then it's a scam. Most L/P fall into this category.

Step two is to run the numbers and figure out the actual cost to own, irrespective of income. Most L/P are like buying a house on a credit card - 15-20% apr. The L/P that don't fall into the above fall into this category. You're free to succeed or fail on your own merits, but failure is all but guaranteed due to the usury terms.

Assume any truck lease is akin to playing three card monte while drinking sambuca.

 

There are companies that will pay a percentage of gross to a lease purchase, and at the same time pay the driver something like $.40/mile. The majority of the money goes to paying the truck off (usually takes 2 years to get the title. The thing that I like about this style payment plan is, you don’t get that big long time period with zero income every time you go home. You drive, you get mileage pay. Hey $1000 a week after returning to work is worlds better than the average where you go 3-5 weeks without seeing any revenue. This is actually doable for those of you whose goal is eventually to become an owner op.