I'm a carrier - Planning to give/sell ownership of my trucks to my drivers (Good idea or Bad?)

I'm a small carrier in Dallas running two trucks under my own authority/MC (Have been at it for about 1 year now). Last week one of my drivers quit, so I've been looking for/interviewing drivers.

I've been thinking of some way to reduce the driver turnover. It's harder to retain good drivers when you're really small and get most of your loads from a load board (which creates angst for drivers as routes/home time can vary a lot some times).

Here's an idea that I've been discussing with potential recruits and they seem to like it.

1. Drivers get a fixed CPM rate of $0.41-0.44 (based on OTR experience)
2. Drivers can make payments to me monthly/quarterly to buy a portion of the truck from me.
3. As soon as they make the payment, they become x% owner of the truck .. and start getting x% of the monthly profits of the truck on top of their CPM rate.

So if the value of the truck today is $40,000 ... and if they pay me $400 (or get that amount deducted from their paycheck) ... each $400 payment will give them 1% of the truck ownership. If the driver is serious about being an O/O, they can make payments consistently and own the truck outright in 3-4 years.

Profit for the truck is calculated as follows:

Revenue
- Fuel/Insurance/Taxes etc
- 10 cents/mile put into a maintenance escrow
- 42 cents/mile paid to driver (his paycheck)
- 10% of gross as dispatching fee (goes into my pocket as I'm doing the dispatching)
- 2.5% of gross as factoring fee to get invoices cashed out (paid to a third party)
= Profit (shared between me and the driver based on the ownership percentage at end of each month)

If driver ends up owning a majority stake in the truck and my share of the profit dwindles down, I still get 10% dispatching fee. I would have pulled out majority of the capital investment that I made originally in the truck, so I can then use that money to buy another truck.

This will encourage drivers to stick around for longer, take better care of the trucks and act in the favor of profitability of the truck since profits are shared with the driver. Drivers can leave any time and I'll buy back their share of the truck based on the truck's current market value.

Does this sound like a sensible thing to do from the Carrier's point of view and the driver's?

 

A couple of things that I guess I didn't clarify in my original post:

• I own the trucks outright, so there are no payments to make on the trucks.
• This truck is a 2012 Freightliner in a pretty good condition.
• This ownership program is in addition to their CPM rate and is totally optional for drivers. It's up to them if they want to take part in it.
• My business is currently profitable and Im not going bankrupt. On the contrary, Im planning to put in more capital into the business and buy another truck later this year. (I usually buy a couple of years old trucks on cash) I know there's a lot of skepticism on these forums. But can you guys please assume for the context of this post that Im telling the truth. I don't want the discussion to derail in a different direction

I agree that I could pay more. I'm usually not hiring people with 15-25 years of experience. Its mostly folks with 2-4 years of experience and they usually come on board for 42-43CPM

 

I guess I still do not understand why folks think this is a bad idea for the driver who aspires to be an owner/operator?

Currently the only option for drivers to become OO is either join a leasing program (which is universally accepted on these forums as evil) or finance a truck and pay ton of interest charges with fixed monthly payments plus have good credit.

Im not trying to cheat the drivers or take their hard earned money from them. With me

• You don't have to pay interest or leasing fees.
• You still get a steady paycheck each month on a CPM rate that is comparable with the market rate.
• You do not have fixed payments each month. You could pay any amount between $0-$1000 each month. You can skip a few months or pay a big amount outright
• You don't have to pay for maintenance from their paychecks. Maintenance is paid from the escrow account which is filled up from the profits of the truck. So if there's a major expense on the truck, you still get your regular paycheck (CPM). The only thing that gets affected is your share of the profit might be less for a few months.
• You are not stuck driving with me forever. If you decide to leave after two years and own 30% of the truck, we'll just calculate the current market value of the truck and I'll pay you 30% of that value in cash to buy your share out.

Again this is for somebody who is already interested in buying a truck in the near future and is willing to pay a certain amount of money monthly to buy a truck. In my opinion this seems like an amazing deal for the driver.

Please help me understand why you think this would be bad for the driver?