Lease Operator Question

Topic 24259 | Page 1

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Cavorkykid's Comment
member avatar

Alright I will try to make this quick and simple. I have been in the industry for 3 years. I have been with my current company for 2 hauling bulk liquid. The company isn't a transportation company but a manufacturing company that just so happens to have 3 trucks so the loads are there. This last year I grossed 90k. This company had one owner operator when I started and just leased on another. I have been informed the company will pay for permits, licenses, fuel, tires, and taxes. I'm not sure on insurance but the truck payment will be the owners responsibility. Now this sounds to good to be true and haven't spoke to the other two operators but if you only had to cover insurance and truck what would be the minimum per week to succeed and still bring home 90k. Now when I ask this the amount per week would need to be enough to set aside for repairs and the ability to buy another truck.

Owner Operator:

An owner-operator is a driver who either owns or leases the truck they are driving. A self-employed driver.

PackRat's Comment
member avatar

Three words: Never, EVER Lease.

Old School's Comment
member avatar

We really don't give out too much advice on this subject, other than we really don't think it's worth the risk. We focus on helping people get started in trucking and finding their way through all the misleading information on the internet. This subject just makes it even more confusing.

You should go to The OOIDA Website and see what you can find.

OOIDA:

Owner-Operator Independent Drivers Association

Who They Are

OOIDA is an international trade association representing the interests of independent owner-operators and professional drivers on all issues that affect truckers. The over 150,000 members of OOIDA are men and women in all 50 states and Canada who collectively own and/or operate more than 240,000 individual heavy-duty trucks and small truck fleets.

Their Mission

The mission of OOIDA is to serve owner-operators, small fleets and professional truckers; to work for a business climate where truckers are treated equally and fairly; to promote highway safety and responsibility among all highway users; and to promote a better business climate and efficiency for all truck operators.

millionmiler24 (CRST Amba's Comment
member avatar

Alright I will try to make this quick and simple. I have been in the industry for 3 years. I have been with my current company for 2 hauling bulk liquid. The company isn't a transportation company but a manufacturing company that just so happens to have 3 trucks so the loads are there. This last year I grossed 90k. This company had one owner operator when I started and just leased on another. I have been informed the company will pay for permits, licenses, fuel, tires, and taxes. I'm not sure on insurance but the truck payment will be the owners responsibility. Now this sounds to good to be true and haven't spoke to the other two operators but if you only had to cover insurance and truck what would be the minimum per week to succeed and still bring home 90k. Now when I ask this the amount per week would need to be enough to set aside for repairs and the ability to buy another truck.

In the famous words of Rick Harrison from Pawn Stars: DON'T DO IT.

Owner Operator:

An owner-operator is a driver who either owns or leases the truck they are driving. A self-employed driver.

Turtle's Comment
member avatar

You have to ask yourself:

1- Why does the company now want you to lease, after 2 yrs of successful employment at a great income?

2- What's the upside for you?

3- What's the upside for them?

if you only had to cover insurance and truck what would be the minimum per week to succeed and still bring home 90k.

If I understand that correctly, you are wondering if you can do this and still maintain the 90k income. If so, why would you even consider the switch to leasing? There would need to be substantially more money involved to even make it remotely worth the risk.

I just don't see it. Good luck with whatever you decide though.

Robert B. (The Dragon) ye's Comment
member avatar

As was mentioned, OOIDA will be the best resource for the information you're seeking out. Just based on your question, I'm going to suggest that you don't even worry about what those two other drivers are doing for the simple fact that you don't even understand what it is that they're doing. They're already owner operators who have leased their trucks on with that company and are not the lease operators which are commonly talked about here and in other forums. They own the trucks (or the bank does) and they have the freedom to move that truck wherever they see fit. The lease operators normally talked about are beholden to the company they work for. The company owns the truck and the driver is renting the truck from the company at a ridiculous price. Owner ops will often lease a truck on so that they don't have to run under their own authority which saves them from buying plates, insurance etc and will often give them access to fuel, tire and maintenance discounts and some other perks but everything is still on them in the grand scheme of things. Trucks break, newer trucks break down much more than they used to and all the new electronic systems and emissions controls will absolutely bury you in down time and additional expenses. Engines don't last as long, wait time on repairs, loss of revenue etc and you quickly learn that one breakdown can break you. Are there owner operators who have made and continue to make a good living in trucking? Sure there are but there aren't all that many and they'll tell you that it's a lot of hard work and there's much more involved than just getting behind the wheel. Now. For an answer to your 90k question. That truck will have to generate at least 250k gross revenue per year to keep you in that 90k range.

Owner Operator:

An owner-operator is a driver who either owns or leases the truck they are driving. A self-employed driver.

OOIDA:

Owner-Operator Independent Drivers Association

Who They Are

OOIDA is an international trade association representing the interests of independent owner-operators and professional drivers on all issues that affect truckers. The over 150,000 members of OOIDA are men and women in all 50 states and Canada who collectively own and/or operate more than 240,000 individual heavy-duty trucks and small truck fleets.

Their Mission

The mission of OOIDA is to serve owner-operators, small fleets and professional truckers; to work for a business climate where truckers are treated equally and fairly; to promote highway safety and responsibility among all highway users; and to promote a better business climate and efficiency for all truck operators.

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.
Sid V.'s Comment
member avatar

For o/o's you need to be looking at net and not gross. Insurance for a new venture will put you back around 20k depending on your driving record.

You need to do a lot more research if you're serious, but leases in general are not a good idea.

Grumpy Old Man's Comment
member avatar

As was mentioned, OOIDA will be the best resource for the information you're seeking out. Just based on your question, I'm going to suggest that you don't even worry about what those two other drivers are doing for the simple fact that you don't even understand what it is that they're doing. They're already owner operators who have leased their trucks on with that company and are not the lease operators which are commonly talked about here and in other forums. They own the trucks (or the bank does) and they have the freedom to move that truck wherever they see fit. The lease operators normally talked about are beholden to the company they work for. The company owns the truck and the driver is renting the truck from the company at a ridiculous price. Owner ops will often lease a truck on so that they don't have to run under their own authority which saves them from buying plates, insurance etc and will often give them access to fuel, tire and maintenance discounts and some other perks but everything is still on them in the grand scheme of things. Trucks break, newer trucks break down much more than they used to and all the new electronic systems and emissions controls will absolutely bury you in down time and additional expenses. Engines don't last as long, wait time on repairs, loss of revenue etc and you quickly learn that one breakdown can break you. Are there owner operators who have made and continue to make a good living in trucking? Sure there are but there aren't all that many and they'll tell you that it's a lot of hard work and there's much more involved than just getting behind the wheel. Now. For an answer to your 90k question. That truck will have to generate at least 250k gross revenue per year to keep you in that 90k range.

I would have been low at my wild guess of at least another $100K.

There is a reason they want you to own the truck instead of them. In addition to all the other reasons you can think of, add liability

Owner Operator:

An owner-operator is a driver who either owns or leases the truck they are driving. A self-employed driver.

OOIDA:

Owner-Operator Independent Drivers Association

Who They Are

OOIDA is an international trade association representing the interests of independent owner-operators and professional drivers on all issues that affect truckers. The over 150,000 members of OOIDA are men and women in all 50 states and Canada who collectively own and/or operate more than 240,000 individual heavy-duty trucks and small truck fleets.

Their Mission

The mission of OOIDA is to serve owner-operators, small fleets and professional truckers; to work for a business climate where truckers are treated equally and fairly; to promote highway safety and responsibility among all highway users; and to promote a better business climate and efficiency for all truck operators.

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.
Bobcat_Bob's Comment
member avatar

If you made 90k why would you want to leave? I made 75k last year and you could tell me I will make 100k as a O/O and I would stick with the sure 75k. I have 2 days off a week, paid vacation (using week 1 of 2 now) and good health insurance, becoming a owner operator would mean surrendering all that.

No thanks.

Owner Operator:

An owner-operator is a driver who either owns or leases the truck they are driving. A self-employed driver.

Grumpy Old Man's Comment
member avatar

double-quotes-start.png

As was mentioned, OOIDA will be the best resource for the information you're seeking out. Just based on your question, I'm going to suggest that you don't even worry about what those two other drivers are doing for the simple fact that you don't even understand what it is that they're doing. They're already owner operators who have leased their trucks on with that company and are not the lease operators which are commonly talked about here and in other forums. They own the trucks (or the bank does) and they have the freedom to move that truck wherever they see fit. The lease operators normally talked about are beholden to the company they work for. The company owns the truck and the driver is renting the truck from the company at a ridiculous price. Owner ops will often lease a truck on so that they don't have to run under their own authority which saves them from buying plates, insurance etc and will often give them access to fuel, tire and maintenance discounts and some other perks but everything is still on them in the grand scheme of things. Trucks break, newer trucks break down much more than they used to and all the new electronic systems and emissions controls will absolutely bury you in down time and additional expenses. Engines don't last as long, wait time on repairs, loss of revenue etc and you quickly learn that one breakdown can break you. Are there owner operators who have made and continue to make a good living in trucking? Sure there are but there aren't all that many and they'll tell you that it's a lot of hard work and there's much more involved than just getting behind the wheel. Now. For an answer to your 90k question. That truck will have to generate at least 250k gross revenue per year to keep you in that 90k range.

double-quotes-end.png

I would have been low at my wild guess of at least another $100K.

There is a reason they want you to own the truck instead of them. In addition to all the other reasons you can think of, add liability

To expand on this, even if the company pays for insurance, what is the policy max? 1 million? 5 million?

NY State has a metal coil endorsement because a local trucking company had a coil come off and kill a family. The award was 25 million. No way you could afford that much insurance, let alone pay the judgement.

Let it be someone else's problem, collect your $90K and go home.

Owner Operator:

An owner-operator is a driver who either owns or leases the truck they are driving. A self-employed driver.

OOIDA:

Owner-Operator Independent Drivers Association

Who They Are

OOIDA is an international trade association representing the interests of independent owner-operators and professional drivers on all issues that affect truckers. The over 150,000 members of OOIDA are men and women in all 50 states and Canada who collectively own and/or operate more than 240,000 individual heavy-duty trucks and small truck fleets.

Their Mission

The mission of OOIDA is to serve owner-operators, small fleets and professional truckers; to work for a business climate where truckers are treated equally and fairly; to promote highway safety and responsibility among all highway users; and to promote a better business climate and efficiency for all truck operators.

HOS:

Hours Of Service

HOS refers to the logbook hours of service regulations.
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