Becoming an owner-operator is the dream of many truck drivers. The vast majority of truck drivers are company drivers, but even those who begin as company drivers may still harbor hopes of one day starting their own independent business.
Unfortunately, it’s easy for drivers with dollar signs in their eyes to become blinded to the realities of an unfair lease-purchase agreement.
What is Lease-Purchase?
Lease-purchase or “lease to own” is when a driver works for a company in order to gradually pay off their truck. They essentially work as a company driver, but they make payments on the truck, including fuel, maintenance, etc. Sometimes, they are even required to make a down payment.
The benefit, of course, is that drivers eventually take ownership of the truck. The driver can then go off and become an owner-operator.
The problem is that these deals often take advantage of the driver. The terms are not in their favor, and many lease-purchase agreements fail because the driver cannot support themselves in addition to making payments on the truck.
A New Task Force
The Federal Motor Carrier Safety Association (FMCSA) recently announced the formation of the Truck Leasing Task Force to take a closer look at these agreements.
As part of the Infrastructure Investment and Jobs Act, passed in 2021, the agency is authorized to do more to make sure truck drivers have the resources they need before signing any such agreements. The Infrastructure bill recognizes the importance of truck drivers to the American economy and tries to protect drivers from being chased out of the industry with bad deals.
The new task force will study lease-purchase agreements and provide resources to truck drivers. Best practices will be provided to give drivers information on how to understand the exact terms and impacts of these agreements, including the effect on total compensation and take-home pay.
According to the Department of Transportation, “Truck leasing is an important step that many owner-operators in the trucking industry take to get started in the business. Leases that contain terms that are inequitable to drivers may discourage safe drivers from continuing to work in the industry.”