Buying my own truck

[Mattangcobra]

I'm going to buy a truck and need to know the cost of plates,permits,Ins. and anything else i've missed. I have 2 years otr exp. So does my co-driver. I'm not sure if I should get my own autority or not. I've heard several people say I shouldn't for a while.

[marcel27208]

Yeah good question, my father in law just bought a truck and said he paid about 1800 but some of the was for taxes(used truck) he only had the surrounding 5 states around NC sc,tenn,ga,va.... so iwould think about 1200 plus the states your going to put on there.

[pepe4158]

I'm going to buy a truck and need to know the cost of plates,permits,Ins. and anything else i've missed. I have 2 years otr exp. So does my co-driver. I'm not sure if I should get my own autority or not. I've heard several people say I shouldn't for a while.

Hmmm the cost will vary dramatically whether you lease-on versus own authority.
1.To lease- you only need tractor Ins....company should do all the rest in most lease agrements

2. Own authority- You need tractor AND trailer cargo Ins.....most Ins. brokers will know how to set you up this way, mine did.
You need then your, MC#, DOT#, and IRP program through your state that varies thru state to state, with your IRP you will pay your IFTA and get your cab card. I needed someone to hold my hand thru it all cuz I was really green (pay agencies as OOIDA and Bracken), now that Ive done it, I am suprised it was so easy really, but when you first go thru it the task looks enormous.

[Mattangcobra]

Thanks

[GMAN]

I just paid a little over $1,400 per truck for my base plates. We no longer have SSR so that is about a $250/yr expense we don't have right now. I would say that your base plates should run about what mine do in Tennessee. Some states can run around $2000 or so.

Collision insurance usually runs between 2 1/2-4% of the stated value of the equipment. So a truck with a stated value of $20,000 would cost about $80/month or less, depending on the insurance carrier. If you lease to a carrier you will need to carrier bobtail or unladen liability. Some carrier's offer this from about $30-60/month. If you get your own authority you won't need bobtail.

Rates can vary widely on cargo and liability insurance. You will need both if you get your own authority. I would guess you will probably pay around $6-8M/year based upon others who have mentioned their rates on the forum. You have more experience than some who have gotten their authority. Most insurance companies require at lease 2 years of experience and a good MVR. If you are thinking about your own authority, you should check around for the best rates. You may check with B & H Insurance. I believe they are in Winston-Salem. Authority costs $300 if you do it yourself.

[pepe4158]

Tell us about the deal ya got....am curious, I am always looking to buy for less and get a good deal on things.
Semis are a tough buy, so much can go wrong, and more then once drivers here were probably thinking I was an, 'idiot' to buy at auction.

[merrick4]

I got a quote from a insurance broker today. It was high (I only have 14 months on my license, but he claimed it wouldn't come down much until I had 3 years.

It was:

Liability $7500
Fire, theft for truck $4800
Cargo up to 100k $1300

Seems high to me, but so far this is the only one that would say they can do it. I was at Freightliner today, and they through Great American Insurance Group offer truck Physical damage policy but not cargo or liability.

By the way not to digress, but the salesman told me something that surprised me. He said that Swift, Prime, Covenant lease the trucks then turn them back in. I don't see why he would lie, but at first blush it's odd that these companies with a boat load of cash would lease. I've always heard they buy them at good prices. As a matter of fact the trucks he had came with warranties only if they were former company trucks as they were assured of the maintenance. O/O trade-ins did not come with warranties. It's kind of a double edge sword in a way, company drivers aren't going to take care of the equipment like an O/O but the companies are better equipped to take care of the trucks.

[GMAN]

Covenant has someone in their corporate offices who sell their fleet trucks. They may have a deal where they sell the trucks. I have been a shop that details them prior to selling. I don't know about the others. These carrier will lease a truck to their drivers, so it is really the driver who is paying for the lease, at least in some cases.

[BigDiesel]

I got a quote from a insurance broker today. It was high (I only have 14 months on my license, but he claimed it wouldn't come down much until I had 3 years.

It was:

Liability $7500
Fire, theft for truck $4800
Cargo up to 100k $1300

Seems high to me, but so far this is the only one that would say they can do it. I was at Freightliner today, and they through Great American Insurance Group offer truck Physical damage policy but not cargo or liability.

By the way not to digress, but the salesman told me something that surprised me. He said that Swift, Prime, Covenant lease the trucks then turn them back in. I don't see why he would lie, but at first blush it's odd that these companies with a boat load of cash would lease. I've always heard they buy them at good prices. As a matter of fact the trucks he had came with warranties only if they were former company trucks as they were assured of the maintenance. O/O trade-ins did not come with warranties. It's kind of a double edge sword in a way, company drivers aren't going to take care of the equipment like an O/O but the companies are better equipped to take care of the trucks.

Those fleet trucks have a guarenteed buyback from the manufacturer.

[GMAN]

Those fleet trucks have a guarenteed buyback from the manufacturer.

That is how Freightliner got into trouble several years ago. They sold a bunch of trucks to some of these big carriers like Covenant, US Xpress, etc., and agreed to purchase them back for a fixed amount of money. What they failed to see is what could happen in the marketplace. From what I recall the market dropped and they had to pay more to buy the trucks back than they were worth in the marketplace. To help themselves out of the situation they came up the their Select Trucks Program. Under Select they probably covered most of their losses, but got into such straights that they wound up selling out to Chrysler. Of course, they are all now part of Mercedes, at least for now. I think they have been sold recently to an investment group.

[merrick4]

. To help themselves out of the situation they came up the their Select Trucks Program. Under Select they probably covered most of their losses, but got into such straights that they wound up selling out to .

GMAN, excuse my ignorance, but I'm a little confused by this. That is how did the Select Trucks Program help them out? One of these trucks is what I'm looking at by the way, I like the idea of a warranty. I will be bringing someone with me at the end that knows this stuff to make sure I do alright.

Did I just answer my own question by the way, that is Select helped them out as they offer a warranty and that is have a better demand in the marketplace?

[GMAN]

Merrick, under the Select program you will pay about $20,000 over the retail price of buying a similar truck outside of this program. I looked at this program several years ago. I recall one dealer with whom I talked who had a Freightliner Classic for $59,000 under the Select Program. He told me that he could sell me an almost identical truck, including the color, for $39,000, but could not sell it for that price under Select. I have checked retail prices and those advertised by Select and have found that most of their trucks are priced at about that much over the price you could buy the same or similar truck outside of the program. If you doubt me check around with dealers and in publications such as The Truckpaper to see what price some of these trucks are selling. In addition you may also pay a high interest rate. The Select Program helped them to recover most of their losses by finding new owner operators who would buy their over priced trucks. Most people buy a truck much the same way they do a car. They don't really think about the total cost, only the down payment and payments.

These people take advantage of inexperienced drivers by allowing them to get into a truck for $1,000 ($999 down). It sounds good on the surface. Payments seem to run about $1,600+-/month, depending on the type and year of truck. It is difficult for a new driver to get a truck financed. That is the attraction to this program. It enables those with marginal credit or limited driving experience to qualify. At the time I checked on this program they would not finance anyone who had previous truck credit. In other words, if you have ever owned a truck and financed it, you would not qualify. If you check around on prices you will find that their trucks are very expensive as to what you can find in the marketplace. I have spoken to a number of individuals who have bought through Select. Their level of satisfaction is mixed, at best. Some have told me that they don't honor the warranty. I recall one guy who had several things replaced under warranty and seemed to be satisfied with his decision. Keep in mind that those trucks usually come from major fleets and may have questionable maintenance. I know of one fleet who buys Freightliners and only changes the oil at either 40,000 or 50,000 miles. I don't recall which. It has been several years since I have been in their garage. In any case, it is well above what I would be comfortable.

If it is only the warranty you want, try to find a truck with lower miles. The engine and drivetrain are the most expensive things to replace. If you can arrange for your own financing you will likely find much better terms as well. It would be best to have your financing lined up prior to making a decision on a truck. Most lenders will require 10-30% down. You may also find a better interest rate by arranging for your own financing.

[pepe4158]

Those fleet trucks have a guarenteed buyback from the manufacturer.

That is how Freightliner got into trouble several years ago. They sold a bunch of trucks to some of these big carriers like Covenant, US Xpress, etc., and agreed to purchase them back for a fixed amount of money. What they failed to see is what could happen in the marketplace. From what I recall the market dropped and they had to pay more to buy the trucks back than they were worth in the marketplace. To help themselves out of the situation they came up the their Select Trucks Program. Under Select they probably covered most of their losses, but got into such straights that they wound up selling out to Chrysler. Of course, they are all now part of Mercedes, at least for now. I think they have been sold recently to an investment group.

Yeah G-man, and I still think their great SELECT plan is a joke....they couldnt make me a decent deal IMO....too much for the dang truck and NO warranty of any type WTF?

[merrick4]

First off GMAN, I know it's often said here, but it bears repeating, thank you very much for your very valuable contributions to this board and to those of us with so little experience. Also, secondly I just want to apologize to Mattangcobra for hijacking this thread, but hopefully as you said you were going to buy a truck, hopefully this is all relevant to you.

Ok, as for the Select trucks, I might have erroneously used that word. That is I did go to the dealer and looked at trucks with warranty, but I don't know about all that finance chicanery. Though I think it's good to discuss it here for others, I have my own money. I might finance part of the truck, but I was told a rate at about 8% and if I do do it, it would be no more than 50% of the purchase price or as little as 20%. And even if I did that, I would pay it off within a few months by putting it on a credit card for a year at 0%. Keep in mind that I have the money to buy it outright with cash so even putting it on a credit card is not a gamble for me.


As for the trucks, well I'll give a couple examples of what I looked at. I did look on truckpaper.com last night, and the price I was given was very close, either a little more or a little less.

I was given a list of 4 all with the same specs and year 2004 model CST120 for a price of roughly $53,900 and he will come down a bit.

12.7- 370/430 10 spd between 352k to 463k miles. 3.58 230 70"RR, White

To be honest the way it was printed out it only has the numbers so some of them I don't remember what they mean. As it has under 500k miles the Detroit warranty goes with it. It also has the Select warranty which coves the following:

All internally lubricated parts
Crankshaft and bearings
cylinder block casting
cylinder heads
Camshaft and bearings
Connecting rods, caps and capscrews
cylinder heads gaskets
cylinder head casting and capscrews
eninge block
exhaust manifold
injector sleeves
oil pump
pistons
piston rings and pins
progressive damage (on covered components)
Rocker arms and shafts
spacer plate or block
iming cover and gears
valve lifters and push rods
valves, valve springs, and valve keepers.

For a few thousand more, I can buy an extra warranty which covers the following for 12 months or 100,000 miles:

fuel injectors
Turbocharger
fuel pump
water pump
fan hub
fan clutch
air conditioning compressor (includes air conditioning clutch)
charge air cooler
rocker cover
oil pan
vibration damper


I put all of this here not so much for you to advise me in particular, though your advice is always welcomed and very much appreciated, but for others that might be in the same situation of looking for a truck. I should add that I recognize that all of this warranty looks good to me, but I don't know much about trucks so I'm sure there are glaring omissions. Two things not covered are the ECM and the air brakes compressor.

The good thing about all of this is I am not alone in the process. As a matter of fact I told the salesman that I know little about the mechanics about trucks but that I will be back with someone. As we got to talking, he knew the person I'm bringing back and he knows that this guy knows what he's talking about. It was funny because as we were talking about price he stated there wasn't much he could do even though he knows my advisor is going to break his back over everything.

One thing that has changed with my plans and has got me thinking was I was going to sign on to CRST Malone and try flatbedding. But he pointed out that for instance if I gross $100,000 $25,000 will be going to them. It got me thinking how do you make money with them? That is a big percentage. I know you did it GMAN, and you cerainly know what you are doing so I must be missing something.

Anway, I think I'm just going to get my own authority and pull reefer. I might as well take advantage of the fact that this advisor of mine is going to teach me the business as well as keep me loaded. There will be a relativelly small fee in all of this but all revenue produced will be going to me. I do kind of want to get into flatbedding but I might as well take advantage of the opportunity I have. Thanks again for everything GMAN.


By the way, good thing I always copy these posts before I hit Submit, this thing took so long to write that when I hit Submit it took me to the log in page

[jrhbull]

Just got my financing started today

[GMAN]

You are welcome, Merrick. I like to see people become successful. Hopefully, I can share some of my experience and mistakes can help someone else from making the same errors.

If you want to buy a Freightliner, you don't need to go through Select if you have your own money. A truck with lower mileage should have warranty left on the engine and drive train. Depending on the mileage, there could be other components that will have warranty. You should be able to buy an extended warranty for around $4-5,000. That is likely to be much less than going through the Select program. You may also want to check around with different dealers. Some are more willing to deal than others. I have spoken to a couple of dealers who seem pleased with Freightliner of Charlotte. Sorry, I don't have a name to give you.

I did fairly well with CRST Malone, but they do get 25% of the line haul. The owner operator receives all of the fuel surcharge, so the 25% may not be entirely accurate. Most carrier's keep about 25%. Keep in mind that the carrier has a lot of overhead. They pay for all the cargo and liability insurance as well as doing the fuel taxes, etc., If you run your own authority, you will be responsible for all of those expenses and must either do the paperwork yourself or pay someone to do it for you. Reefers seem to do pretty well year around, but there are pros and cons to anything you do.

I prefer running my own authority. For me it works better than leasing to a carrier. I would not recommend it for everyone. If you are highly motivated then it could work. Good luck whatever you decide to do.

[rank]

$2,000 for the plate (ON based + ~30 states IIRC).
$12,000 for insurance (liability only)
$10,000 maitenance (truck only)

[merrick4]

All that info I posted was wrong. I just spoke with the dealer again, and the trucks I listed were 2004 and they don't come with the Select Warranty. Those come with the remainder of the factory warranty. I knew it sounded too good to be true. The warranty is only for the Select trucks for the years like 2002. I don't want that. Anyway I'm going tomorrow to look at the trucks with my mentor so we'll see what's happens.

[yellowcabbill]

Merrick- you remarked about leasing vs buying for the fleet operators, well this has to do with balance sheets and taxes. If they buy 5 new trucks at $100K each (and I think the big guys get a better price then that) the balance sheet shows the company in debt to the tune of a half million dollars and based on total revenue and expenses can reflect in a negative why when future financial dealings come about. (buying more stuff, a line of credit for parts, etc..) If the same out fit leases the trucks at say $1000.00 per month each the financial outfits see this as an operating expense, not long term debt, and with the same amount of total money the operation is more "solvent". (In better financial shape.) Also for tax reasons the $5000 per month payment for the five trucks is deductable right away from total income. Buying requires an amoritaztion schedule for I think 5 years. By the the $5K a month credit for paying for the truck the company will pay less in taxable income. Sorry if this went on too long. Bill

[duck]

Warranty wise - read them carefully. Many extended warranties to the truck don't cover a lot of the stuff that nickle and dimes a guy. Worn shocks, rubbed thru wires, seals etc.

Were i to buy a truck - I would look to purchase mfg SPECIFIC warranties.

CAT offers an "Advantage" warranty - costs are usually less than 2k and can be had for up to 3/300. You can keep getting it till your truck has 8/800k on it (and it passes the inspection). So in theory if you had a 7 year old truck with 763k on it and you pass the inspection (external visual with oil sample) you could paste a 3/300 on that and be covered till 1mill plus.

If an engine had a recent overhaul get an OPT coverage.

There are various levels of coverage wit deductables or not avail - talk to the service department guys - they usually know whats avail.