Lease Purchase

What's the pay difference in company driver vs lease purchase and being a average driver who's a good worker. Thank you for any reliable input

It's impossible to compare a lease driver to a company driver because a lease driver is a business owner. They don't get paid a wage. They get paid revenues for which expenses need to be deducted and the expenses vary too wildly to nail down. How new is the truck? What kind of fuel mileage does it get? What areas of the country are you running? What's your fuel and tire discount? And of course you have a ton of variables built into the contracts themselves - varying interest rates, balloon payments, bonuses, fuel surcharges, and all kinds of stuff. So forget about the leasing thing.

But I can tell you this. There's probably a 50% difference in wages between the top 10% of company drivers and the bottom 10% of company drivers at any given company. It's not uncommon for the top solo drivers to bring in maybe $55,000/year with some experience but at the same company the bottom 10% are probably making $30,000.

Trucking is performance based. The best drivers with strong reputations and proven safety and performance records get great miles whenever great miles are available. The worst drivers rarely get great miles. They get whatever scraps are left over after the best drivers get theirs.

If you went to any major trucking company, stood in the lounge, and asked company drivers as they came by what kind of miles they average per week you'll hear as high as 3,200 and some as low as 2,200. Some guys will be so exhausted from running hard they can't wait to finally squeeze in a nap. Other guys have been sitting around for two days waiting on something to do.

This is true for every major company out there. That's why we never talk about "good companies versus bad companies". We teach people the attitude, work ethic, and demeanor it takes to be a top driver so they can do well at any company they work for. Lousy drivers are going to find they're unhappy no matter where they work. That's the nature of this business but there are a lot of people who never seem to figure that out. They always think their lack of miles and better treatment is from working at bad companies.

It's impossible to compare a lease driver to a company driver because a lease driver is a business owner. They don't get paid a wage. They get paid revenues for which expenses need to be deducted and the expenses vary too wildly to nail down. How new is the truck? What kind of fuel mileage does it get? What areas of the country are you running? What's your fuel and tire discount? And of course you have a ton of variables built into the contracts themselves - varying interest rates, balloon payments, bonuses, fuel surcharges, and all kinds of stuff. So forget about the leasing thing.

But I can tell you this. There's probably a 50% difference in wages between the top 10% of company drivers and the bottom 10% of company drivers at any given company. It's not uncommon for the top solo drivers to bring in maybe $55,000/year with some experience but at the same company the bottom 10% are probably making $30,000.

Trucking is performance based. The best drivers with strong reputations and proven safety and performance records get great miles whenever great miles are available. The worst drivers rarely get great miles. They get whatever scraps are left over after the best drivers get theirs.

If you went to any major trucking company, stood in the lounge, and asked company drivers as they came by what kind of miles they average per week you'll hear as high as 3,200 and some as low as 2,200. Some guys will be so exhausted from running hard they can't wait to finally squeeze in a nap. Other guys have been sitting around for two days waiting on something to do.

This is true for every major company out there. That's why we never talk about "good companies versus bad companies". We teach people the attitude, work ethic, and demeanor it takes to be a top driver so they can do well at any company they work for. Lousy drivers are going to find they're unhappy no matter where they work. That's the nature of this business but there are a lot of people who never seem to figure that out. They always think their lack of miles and better treatment is from working at bad companies.

Thank you Brett for your response it makes sense that it depends on work ethic and what kind of worker driver you are to get the great miles I wouldn't do lease I just hear a lot of companies talk about leasing on their websites so I just wanted to see what the differences was.

Whenever I hear the word "lease" my mind automatically changes it to "fleece." This is something I did well before trucking.

Brett is right. There are a lot of variables to nail down. Fuel? Your cost. Truck breaks? Your cost (generally, I'm sure most company lease agreements mention a maintenance plan, but you're still paying for the plan as part of the lease). Want health insurance? Go buy it on the open market, generally.

I would be really surprised if many lease drivers net significantly more than a company driver does, especially if you factor in insurance, simpler taxes, and any other perks offered to the company driver. But I may be totally wrong. It would be a lot of liability for me to assume to find out...

Whenever I hear the word "lease" my mind automatically changes it to "fleece." This is something I did well before trucking.

Brett is right. There are a lot of variables to nail down. Fuel? Your cost. Truck breaks? Your cost (generally, I'm sure most company lease agreements mention a maintenance plan, but you're still paying for the plan as part of the lease). Want health insurance? Go buy it on the open market, generally.

I would be really surprised if many lease drivers net significantly more than a company driver does, especially if you factor in insurance, simpler taxes, and any other perks offered to the company driver. But I may be totally wrong. It would be a lot of liability for me to assume to find out...

Hey there thanks for your opinion

Hey there thanks for your opinion

No prob man... it is just speculation on my part, but everything I've heard is that profit margins are really thin in trucking. They can't be too much better in a truck you're making payments on is my thought process...

I would be really surprised if many lease drivers net significantly more than a company driver does, especially if you factor in insurance, simpler taxes, and any other perks offered to the company driver. But I may be totally wrong. It would be a lot of liability for me to assume to find out...

No you're not wrong. They don't make more than company drivers for the most part. And the big difference between working for a company and owning a business is that you don't lose money working for someone. You might be off for a day or a week and not make money, but you're not losing money either. Business owners have that downside risk to contend with.

But the biggest red flag that people should be paying attention to is the idea that a trucking company wants you to go into the same business they're in. Businesses exist to make money. If they can make money doing something, they will. And of course they'll keep it all to themselves. So why would they want you to go into business by leasing or buying your own truck if owning a truck and hauling freight is so profitable?

If you owned a pizzeria and you were making killer money doing it would you encourage other people to do it? H*ll no! You'd open 10 more and keep your mouth shut if you're smart about it. But what if owning the pizzeria and selling pizzas was less profitable than allowing other people to open franchises with your brand? The heck with owning pizzerias, right? Let other people pay you to own and operate pizzerias with your name on it and you just collect the fees from them. You're getting a nice profit, taking very little or no risk, and doing far less work than you were before.

That's pretty much how this works for trucking companies. Owning trucks and hauling freight has very tiny profit margins and very high risk. So instead of owning the trucks yourself, why not sucker someone else into taking on all of that responsibility and risk while you just run the franchise? You're the freight broker, the logistics service, the repair shop, and the insurance salesman. You get things in bulk and sell them at a profit to your lease drivers and owner operators without all the risk and overhead of owning the trucks yourself. Instead you'll make your money selling things to the people that own the trucks.

Many people who are new to the industry don't realize this but Prime Inc used to be a lease company only. There were very few, if any company trucks for many years. You can be sure they'd still be doing that if they were able to scrape up enough lease drivers and owner operators to keep their freight moving. But it's not that easy.

It should always throw a huge red flag anytime a business encourages you to go into business for yourself. I've owned and operated numerous small businesses over the years and I can assure you that if I'm encouraging you to start a business of your own and be a partner of mine it's because I need someone to do what you'll be doing but there's really no profit in it so I don't want to do it myself. If there was a big profit in it I'd keep my mouth shut, do it myself, and rake in the profits.

I would be really surprised if many lease drivers net significantly more than a company driver does, especially if you factor in insurance, simpler taxes, and any other perks offered to the company driver. But I may be totally wrong. It would be a lot of liability for me to assume to find out...

No you're not wrong. They don't make more than company drivers for the most part. And the big difference between working for a company and owning a business is that you don't lose money working for someone. You might be off for a day or a week and not make money, but you're not losing money either. Business owners have that downside risk to contend with.

But the biggest red flag that people should be paying attention to is the idea that a trucking company wants you to go into the same business they're in. Businesses exist to make money. If they can make money doing something, they will. And of course they'll keep it all to themselves. So why would they want you to go into business by leasing or buying your own truck if owning a truck and hauling freight is so profitable?

If you owned a pizzeria and you were making killer money doing it would you encourage other people to do it? H*ll no! You'd open 10 more and keep your mouth shut if you're smart about it. But what if owning the pizzeria and selling pizzas was less profitable than allowing other people to open franchises with your brand? The heck with owning pizzerias, right? Let other people pay you to own and operate pizzerias with your name on it and you just collect the fees from them. You're getting a nice profit, taking very little or no risk, and doing far less work than you were before.

That's pretty much how this works for trucking companies. Owning trucks and hauling freight has very tiny profit margins and very high risk. So instead of owning the trucks yourself, why not sucker someone else into taking on all of that responsibility and risk while you just run the franchise? You're the freight broker, the logistics service, the repair shop, and the insurance salesman. You get things in bulk and sell them at a profit to your lease drivers and owner operators without all the risk and overhead of owning the trucks yourself. Instead you'll make your money selling things to the people that own the trucks.

Many people who are new to the industry don't realize this but Prime Inc used to be a lease company only. There were very few, if any company trucks for many years. You can be sure they'd still be doing that if they were able to scrape up enough lease drivers and owner operators to keep their freight moving. But it's not that easy.

It should always throw a huge red flag anytime a business encourages you to go into business for yourself. I've owned and operated numerous small businesses over the years and I can assure you that if I'm encouraging you to start a business of your own and be a partner of mine it's because I need someone to do what you'll be doing but there's really no profit in it so I don't want to do it myself. If there was a big profit in it I'd keep my mouth shut, do it myself, and rake in the profits.

Well put Brett I don't know much about trucking or leasing but you make a lot of sense in your points. I have a question with leasing can a trucking company lease out older trucks to drivers? Sounds a little strange if they can since the truck is old and most likely paid off for where's the payments going to if the truck is already paid off for?? I'm not sure if any companies do this I was just curious. Does it only have to brand new trucks to lease?

I have a question with leasing can a trucking company lease out older trucks to drivers?

They could but they rarely do. For one, you're trying to attract people to your company and convince them to lease a truck from you. So you're going to want nice equipment. Then of course you have the cost of maintaining old equipment that likely ran out of warranty. That's an expensive proposition. Then of course you have laws and regulations to deal with like state of the art emissions controls which many of the old trucks don't have. Finally you have fuel efficiency high on your list and newer trucks tend to get better fuel mileage than older trucks.

So most of the time a company is going to lease you a truck that's less than three years old.

I have a question with leasing can a trucking company lease out older trucks to drivers?

They could but they rarely do. For one, you're trying to attract people to your company and convince them to lease a truck from you. So you're going to want nice equipment. Then of course you have the cost of maintaining old equipment that likely ran out of warranty. That's an expensive proposition. Then of course you have laws and regulations to deal with like state of the art emissions controls which many of the old trucks don't have. Finally you have fuel efficiency high on your list and newer trucks tend to get better fuel mileage than older trucks.

So most of the time a company is going to lease you a truck that's less than three years old.

Thank you Brett for your opinion. I'm just going to do company driver sounds somewhat better I'm sure it has it's ups and downs like any other line of work you do. What companies did you drive for?