New Article From Old School About Buying Or Leasing A Truck

Oh, and I also agree with Old School that Bud and Ernie have been honest and generous with their business ventures and we very much appreciate that. And there have been others.

It's not these guys that concern me at all. They're doing things the right way, they're getting exactly the results you would expect for it, and they're being honest about it.

I think Old School can tell me anything and I would take it to heart. I respect that guy more than he realizes it. If there's ever anything in the air I can always call him and talk to him about it over the phone. Trucking isn't his greatest knowledge though, he's extremely good at giving marital/relationship advice. He's the only person I have forwarded my email paystubs to when I was leasing.

Having said that, I highly recommend we give him a new title of 'Super Moderator'!

Brett, if you make him a Super Moderator I will write a week-long journal of my local fuel hauling job that would mimic my Adventures of Daniel B. thread.

Good morning guys! Thank you for this article (and the others) and all the valuable feedback! Lots of intelligent perspectives. I am preparing to go into training in September after 30 plus years in the corporate world. Can't wait to experience the good, the bad and the ugly from my new office window! See you out there brothers.

I have a confession, even with all the warnings I bought a truck and am leased on to an intermodal company. I have an older Volvo with over 500k miles on it now. I don't have a fancy new truck, as a matter of fact I don't like the color at all (Penske Yellow). I have no warranty and will be responsible for any maintenance and repairs. I'm leased on to an all owner operator company and it is common to see a driver wrenching on his truck in the yard, as I have myself done minor repairs. The purchase of my truck is completely separate than the company I'm leased to (I have a loan with a finance company). I'm brand new to owning a truck only been 4 months now but at the end of the year I'll talk about my numbers good or bad.

I have a confession

It's not a sin!

The idea of owning your own rig, being the boss man, calling all the shots, and making the big money appeals to us all!

Not to mention, there are a million and one ways to attempt to make it work.

• You can run dry van , refrigerated, flatbed, tanker, or intermodal like yourself.
• You can run dedicated fleets, lease on with a company, get your own authority, or mix it up.
• You can approach shippers directly, try going through different brokers, or use the load boards.
• You can finance a new truck and run the heck out of it under warranty, or finance a nice used one, or pay cash for an old truck and turn wrenches yourself

The combinations and opportunities seem dizzying. Not to mention, there are like 3 million trucks on the highways. They can't all be going broke, right? Someone has to be making good money somewhere it would seem.

Then, as Old School mentions in his article, this is a very emotional endeavor for a lot of people. There's no lack of pride amongst owner operators as they gloat over their rigs. There's certainly no shortage of people boasting about making six figures profits. And of course the nation is blanketed with trucking companies with well thought out marketing messages that make you feel like an idiot for not taking advantage of this obvious path to riches.

The message is almost completely one sided. It's like there's a massive rock concert going on touting the promise of riches as an owner operator and everyone has their flags waving, explosions are going off, and stage lights are lighting up the night. There's custom big rigs lining the parking lot and they're making it rain money from the rafters.

Then there's these two dudes, Old School and myself, standing alone in the parking lot holding up a sign that says, "Don't believe them. It's not like they say" and everyone is just throwing their beers at us and giving us the finger as they go by.

"Shut up Old Dudes. You're just losers that don't get it like the rest of us do. You can't hack it."

The reason the message is all one-sided is because that's where the incentive is. There is a massive economy that revolves around a steady stream of owner operators and lease drivers taking their shot at this. There are brokers, trucking companies, dispatching operations, insurance companies, towing and repair operations, dealerships, financing companies, and of course a million existing lease operators and owner operators all of which have some financial or personal incentive to sell you "the dream". Either they're going to make money off of you directly, or they're trying to make themselves look good.

But what incentive does anyone have to tell you not to do it? Do you think there's anyone out there knocking on my door saying, "Brett, we'll pay you $50,000 a year if you'll convince people not to buy or lease a truck!"

Heck no! How would anyone make money convincing people not to buy or lease a truck?

If all I cared about was making money and I didn't let my pride or integrity get in the way I'd setup a paid system that teaches people the in's and out's of leasing and then on top of that I would get paid a referral bonus every time someone decided to lease or buy a truck from one of my clients. Then I would setup a system to support lease drivers or owner operators in some way. Maybe I'd dispatch them, or sell them insurance and towing coverage, or help them shore up their finances.

Like I said, there's a million and one ways to make money off of people who own or lease trucks. And of course there's a million and one people bragging about their own "pride of ownership" and how they're part of the "Big Boys Club" raking in six figures.

I'm not saying you absolutely can not own a truck and make a six figure profit. I'm just saying no one has ever once demonstrated to me that they're doing it and then offered to show me how it's done. I've been asking around for decades but I'm still standing here waiting for undeniable proof that it's being done and a solid plan for me to make it happen for myself.

So it's not a sin to take a shot at it. But to me it has all of the characteristics of a gold rush. It's not that there isn't any "gold in them thar hills." The question is how much gold is there, and how many people are going to find enough to make the endeavor worthwhile?

Just be careful who you ask, though. It's a touchy subject I'll tell ya!

Please check out Mark Staite on YouTube. He is a Prime Lease driver. He gives very helpful and useful advice for new and experienced drivers. He DOES NOT push leasing. He has a video where he gives his gross income for a year at Prime and then his net income. But I am not sure the "net income " is after tax numbers he gives. Anyway, he grossed around $125,000 and after expenses he wound up with $57,000. I am on pace to make more than that as a company driver for JB HUNT INTERMODAL.

"Bud" actually gave us realistic numbers from his lease at Prime, and when you took it all in he was really making about what a company driver made. The biggest problem he faced was he couldn't reconcile the charges they gave him when he terminated his walk away lease. I still sense a little bitterness on his part about them taking the money he had worked hard for to set aside in escrow accounts. After it was all said and done, they decided those monies were theirs, and he had no recourse, even though he was the one who had done the work and made the sacrifices to earn the money.

That is exactly right, including the "little bitterness" part. Now I guess I have to get over it since you called me out on it.

The fact is that there is no practical recourse on a "walk away" lease. They do all the accounting, they push back pretty hard if you ask for an itemized statement, and generally you are stuck with what they want to give you at the end. Personally I think calling it "walk away" is deceptive.

And, as I mentioned before, but quite awhile ago, I know for a fact that company drivers were regularly getting the more lucrative loads, and that I was not always (or possibly never was) paid 100% of the tarp pay on loads, contrary to what they claim. As Brett and Old School have said before, how can you really know what the load pays if you never, ever see the bill that the customer pays from? The answer is you can't know.

So, again, if I were younger and had more time, energy, and experience as a mechanic, I might think about owing a truck if I had a solid contract and some big savings going into it. But that's not going to happen between now and retirement, so I'm very content to continue driving someone else's truck for pay.

The part that concerns me is quarterly tax payments aren't deducted and then what about health insurance, retirement savings etc.

Oh I'm positive there have been and are successful lease operators, but reality is.. it's difficult, complicated, and nothing a brand new driver should venture into IMO. That's all I think anyone is really saying. The deck is stacked against you (the risk) from the get go and it takes a rare hard working saavy, business smart person to pull it off. I will say we do have quite a few top tier experience drivers who n this board, but we are a unique group and not a representative sample if the masses.

Brett, since you are an entrepreneur, I do have a client who started under his OWN AUTHORITY (in capital because that is a key word) back in 2007 with one truck, had a good business plan in please and started slowly but surely to add O/Os to run under his authority (made sure he hired safe O/Os as to make sure they did not dirty his FMCSA score and started gradually growing, getting contracts with major Distributors and running his operations wisely.... Now the guy runs 300 trucks, 224 he owns and 80 are owner ops so I guess the difference I was not getting was between Lease drivers with the big companies and lease drivers with the smaller companies because all the guys I do bobtail for working for the smaller companies tell me they make good money since those companies need them to survive.

"Bud" actually gave us realistic numbers from his lease at Prime, and when you took it all in he was really making about what a company driver made. The biggest problem he faced was he couldn't reconcile the charges they gave him when he terminated his walk away lease. I still sense a little bitterness on his part about them taking the money he had worked hard for to set aside in escrow accounts. After it was all said and done, they decided those monies were theirs, and he had no recourse, even though he was the one who had done the work and made the sacrifices to earn the money.

That is exactly right, including the "little bitterness" part. Now I guess I have to get over it since you called me out on it.

The fact is that there is no practical recourse on a "walk away" lease. They do all the accounting, they push back pretty hard if you ask for an itemized statement, and generally you are stuck with what they want to give you at the end. Personally I think calling it "walk away" is deceptive.

And, as I mentioned before, but quite awhile ago, I know for a fact that company drivers were regularly getting the more lucrative loads, and that I was not always (or possibly never was) paid 100% of the tarp pay on loads, contrary to what they claim. As Brett and Old School have said before, how can you really know what the load pays if you never, ever see the bill that the customer pays from? The answer is you can't know.

So, again, if I were younger and had more time, energy, and experience as a mechanic, I might think about owing a truck if I had a solid contract and some big savings going into it. But that's not going to happen between now and retirement, so I'm very content to continue driving someone else's truck for pay.

This doesn't apply to the whole conversation, just your post. By law, you're supposed to have the rate con for every single load you agree to haul. Most folks doing company lease never receive it until they adamantly pursue it.