Saw this ad in the june issue of Petro’s free mag, it’s from RTI ( drive4rti.com ) it shows a run down of the costs and profits a driver can expect…
Truck … 2012, Prostar International. Dispatched average 2500 miles per week at 98c per mile… Revenue per week = $2450.00, stop/detention pay $57.50, fuel surcarge $1,025.00… Total revenue = $3,532.50 per week.
Costs… Fuel $1,586.00, tractor lease $449.00, plates free, permits free, fed highway tax $11.00, prepass or ezpass free, satellite free, fuel tax $37.00, Physical damage insurance, $13.00, Bob tail insurance $6.00, Occ accc insurance $30.00, Full service maintenance cost $175.00.
Total weekly costs = $2,307.00.
Weekly profit $1,225.50.
Thats absolute crap ! I make more than that every week as a company driver and take into account the O/O has to pay his own SS, Health insurance, tax, workmans comp costs so after all that he’ll get about $800.00 then if he gets a blow out he’s down a couple of hundred.
If they want drivers to apply they shouldn’t advertise how little the guy is gonna get.
If you are gonna lease a truck you need at least $2500.00 a week profit so you can keep ahead and pay unexpected bill that arise. I see guys struggling and getting deeper in the hole every week. I know of only one O/O who is doing things right and thats Rich (Longwayround), he is buying his nice Volvo for a dealer and not our company so his payment is about half what the others have and he is doing great.
It’s the way of companies to keep drivers in debt to them so they can just get by and be always in debt to them, that way it’s too expensive for the driver to get out of the lease.
Some poor fools wil fall for the $1225.00 a week without even considering the other expenses not listed and end up in the poop.
Prime are a good example of such companies that do this to drivers and they don’t realise that drivers talk to drivers and they are getting a bad reputation.
newmercman:
I saw that advert, plenty of takers for those rip off leases. Mugs…
Why would that be a rip off if they tell you all the numbers upfront?
Because they don’t tell you all the numbers
There are numerous ways they stop money from the settlement before they starve you out of the truck a year before the lease is up
There are some good leases out there, but the vast majority are a rip off
How true this is NMM, Mid-West Emery were famous for this years ago. They were in charge of the maintenance on the truck and just when the driver looked like he was gaining on it, “oops driver, your going to need a new part that’s going to be expensive”
In fact i think they were caught chargeing drivers for new parts they said were put on the truck but were not.
The ad says 98cents per mile but IIRC back when diesel fuel was a lot cheaper o/d said you needed more than a dollar a mile to stay in business and you can only run the miles the company gives you.
But, as you say, some drivers do make a success of it so more power to them.
Here’s a few numbers that underline why I made my first comment about rip off leases…
Case No1, a company driver doing 2500miles a week at 40cpm, gross earnings $1000, less 7.5% Social Security, Medical and Disability Insurance and Workman’s Comp paid by company, one week’s vacation pay, matching 401K contribution. Take home $925 pw.
Case No2, the Owner Operator earning as Pat described, gross income $1250, less 7.5% Social Security and 7.5% Self Employment Social Security, so now they’re left with $1100, from that they have to pay Workman’s Comp, Medical and Disability Insurance, an very low figure for that would take another $300 out of their weekly settlement so they’re earning $125 less than a company driver and they get no vacation pay and no matching 401K.
In both cases there is no tax until April 15th and tax rate will depend on individual circumstances, so we will forget it, but you cannot forget that you earn less as a lease operator than as a company driver, that’s if all goes well, if the truck breaks down (which it will, they all do) they earn SFA that week, yet the payments are all still due.
I know of many lease operators who have to train new drivers and use them to double man the truck just so they can make the lease payments. The companies that do this are huge, with thousands of trucks, they make very little profit from delivering freight, yet make millions of dollars profit each year…from lease operators. Most lease trucks have 5 or 6 failed leases in the three years that they are out on lease before they go back to the manufacturer.
Talking to a guy a few weeks back who ran 4 trucks and he told me he loves Prime because they keep getting all their repo’s back from lease operators who can’t keep up the payments and he buy’s a hardly used truck for a reduced amount.
I have heard that Prime are not the worst by far and I was shocked to find out that Schneider actually have a very good lease programme, with a very good success rate. Mind you Schneider lease their old stuff once it comes off the main fleet, whereas Prime give out brand new top of the range trucks with all the toys
Makes me laugh reading Prime’s ads though
‘Family orienated and lots of hometime’ Do the not know drivers talk to drivers and every driver I have ever talked to who works for or has worked for Prime has nothing in the least bit good to say about them. One guy left us (he was an O/O) went to Prime and leased a new Cascadia, didn’t get home for 6 weeks and when he did he told them to come and get their truck
Pat Hasler:
Makes me laugh reading Prime’s ads though
‘Family orienated and lots of hometime’ Do the not know drivers talk to drivers and every driver I have ever talked to who works for or has worked for Prime has nothing in the least bit good to say about them. One guy left us (he was an O/O) went to Prime and leased a new Cascadia, didn’t get home for 6 weeks and when he did he told them to come and get their truck
They know drivers talk but theres always 1000 more home boys from the ghetto to train and retain. Isn’t that how most of the big companies in the US function? They all seem to survive by training large numbers of African-Americans from the poor neighbourhoods of the big cities who probably believe they’re bettering their lot in life and are taken in by classic North American trucking jargin like “family orientated” and “regular home-time”…those two phrases start alarm bells ringing the moment I read them in any advert, as it usually means the company is the complete opposite.
