For the aspiring entrepreneur, becoming an owner operator lets you drive for yourself instead of someone else.
But how do you get rolling if you don’t yet have the cash to purchase a truck outright? Or if you lack the credentials to qualify for a truck loan?
That’s where semi-truck leasing comes in. Leasing your first truck gets you behind the wheel today, so you can start making money now instead of later.
There are other potential benefits of becoming a lease operator:
- Short-term path to truck ownership
- Low down payments
- Low deposits
- No long-term commitment
- Opportunity to drive quality equipment
- Pride of ownership
- Relaxed credit standards or no credit check
- Lease completion incentives
- Experience first-hand perks of ownership
Do you have what it takes to succeed as a lease driver? Here are 5 tips for getting started on the right foot and maximize your earnings as you haul cargo over the road.
#1: Do your homework on truck leasing programs
The more you know ahead of time, the better decisions you’ll make when becoming a lease driver.
- Talk to experienced owner operators about what works when it comes to leasing a truck.
- Ask lots of questions when talking to carriers. What are their monthly or weekly rates and down payment? Do they help with insurance, maintenance, towing or repairs? What other support is available to lease drivers?
- Read before you sign. Know what’s in your lease contract. Your carrier should be crystal clear about your responsibilities and the services they will provide to you. They should be happy to answer all of your questions.
#2: Understand the difference between lease and lease purchase
If you go the leasing route, you’ll have the choice of a lease or lease purchase arrangement.
With a semi-truck lease, you essentially pay rent for the use of the truck, similar to renting office or apartment space in a building.
For example, Prime Inc. offers a walk-away lease through its Success Leasing program:
- No money down
- No credit check
- Late-model tractors
- Low operating cost
- Optimal fuel mileage
- Extensive OEM warranties
- No worries about what to do with owned equipment if the unexpected happens
- Earn lease completion incentives
- Long-term benefits similar to a retirement plan
- Big earnings potential with leased equipment
A lease purchase program is different in that it gives you the option of walking away from the truck or purchasing it outright at the end of your lease term.
The lease purchase option at Success Leasing is available to Prime Drivers.
- Lease purchase a new or used truck from a large inventory
- Become an owner operator without having credit approved by loan office
- Own your own truck or walk away at the end of the term
- No credit check
If choose a lease purchase agreement, terms will vary depending on whether you choose a new or used truck:
|New Truck Option||Used Truck Option|
|Walk away option at end of term||Walk away option at end of term|
|Lease term can be 3-4 years||Lease term of 2 years maximum|
|Eligible for breakdown pay under OEM warranty||Eligible for breakdown pay under OEM warranty|
|Loaner truck program -- reduced rate based on availability||Loaner truck program -- reduced rate based on availability|
|Optional emergency fund||Optional emergency fund|
|Purchase option amortizes weekly with lease payments||Purchase option amortizes weekly with lease payments|
|Repair and tire replacement reserve of 1 cent per authorized dispatched mile (unused portion refunded at end of lease purchase agreement)||Repair and tire replacement reserve of 7 cents per mile (unused portion refunded at end of lease purchase agreement)|
|Ability to finance a new or used APU in purchase price of truck to consolidate one low weekly payment||Ability to finance used or new APU in purchase price of truck to consolidate to one low weekly payment|
The driver is responsible for a down payment or $13,000, which may be lowered to of $8,000 under certain criteria. An additional $1,000 down payment is required for any financed APU.
The driver pays $1,000 at the time of the initial order, and the remainder of the down payment upon signing the lease purchase agreement.
#3: Choose the right equipment
You want to lease from a carrier that offers a good choice of makes, models and colors.
Success Leasing has quality Freightliner, Peterbilt and International trucks available. Lease drivers also benefit from a number of features:
- Trucks available to meet owner operator specs
- Fuel efficiency with fleet average over 7 mpg
- Advanced safety features to prevent accidents and lower cost of insurance and repair
- New truck ordering with additional features available
- Industry leading warranty
- Low operating cost
Success also supports lease drivers with a comprehensive Protection Package for each truck:
- OEM warranties
- Drive line repair cash coverage
- Pre-lease trucks bumper-to-bumper warranties
- Breakdown pay
- Loaner truck program
- End of lease incentive
- Longevity incentives
#4: Estimate your costs
Like any entrepreneur, you’ll need to be prepared to cover the cost of doing business as an owner operator. Here is a summary of the costs you’ll be responsible for as a lease driver.
- Lease. Your lease payment will vary depending on the type of truck you drive and the make and model you choose. Weekly fixed payments at Success are currently as follows but subject to change:
- Reefer: 3-year lease. Peterbilt starts at $984 and Cascadia Class starts at $995.
- Flatbed: 4-year lease. Peterbilt starts at $898 and Cascadia Class starts at $912.
- Tanker: 4-year lease. Peterbilt starts at $915 and Cascadia Class starts at $931.
- Mileage fees. Lease drivers are responsible for variable mileage fees for all authorized dispatched miles. At Success, the weekly mileage charge is 5.5 cents per mile.
- Tire fees. Your tire fund covers tire replacements, and Success drivers receive a refund of the unused portion at the end of the lease. The tire fee at Success is 2.5 cents per mile for all authorized dispatched miles.
- Excess mileage. The excess mileage charge is based on average weekly miles and is also refunded after the terms of the lease are completed.
- 3 year lease
- 0-2900 miles — 0
- 2901-3400 miles — 5 cents per mile
- 3401-4100 miles — 3 cents per mile
- 4101+ miles — 1 cent per mile
- 3 year lease
- 4 year lease
- 0-2750 miles — 0
- 2751-3200 miles — 5 cents per mile
- 3201-3800 miles — 3 cents per mile
- 3801+ miles — 1 cent per mile
- 4 year lease
- Insurance. All trucks leased from Success are covered by physical damage and bobtail insurance. You’ll also want to invest in cargo and liability insurance, as well as workers compensation if you hire employees. Lease drivers are also responsible for covering their own health, dental, vision and life insurance.
- Taxes. As a self-employed truck driver you’ll need to file quarterly federal and state income tax returns.
#5: Anticipate earnings & savings opportunities
Ultimately your success comes down to earning enough to cover your expenses and make a profit.
Start by determining the number of miles or revenue you need to drive each week.
Then plan ahead to ensure that you’re logging the miles you need and hauling the loads that will get you to your goals.
When considering different carriers, look for opportunities to earn extra incentives. Success offers a first-time bonus of $300 after your first dispatch, and a re-lease bonus of $5 per week for every week your previous truck was leased.
Is lease driving the right option for launching your own trucking business? Contact Success Leasing today to learn about how to lease a quality new or used truck and start rolling!
If you are interested in driving for Prime, you can get started today by applying online.
Want to speak with a Recruiter first? Call 877-491-1112.