Today’s market poses many challenges to truck drivers and trucking companies alike. Along with the infamous driver and labor shortage, drivers and carriers have to deal with inflation in the form of skyrocketing fuel, insurance and overall equipment costs — not to mention labor costs and availability. Moreover, many drivers whose trucks need repairs face long wait times just to have their vehicles looked at, resulting in significant downtime and loss of revenue.
PGT Trucking, Inc. has a proven solution to assist prospective owner-operators through these challenges — lease purchasing. PGT is a multi-service transportation firm offering flatbed, dedicated, international and specialized services, primarily to the steel and building material industries. Based outside of Pittsburgh, Pennsylvania, PGT has been providing quality transportation services for more than 41 years, and their lease purchase program has been a driver offering since 1997.
Through their lease purchase program, PGT is able to offer drivers the opportunity of owning their trucks, in contrast to the challenges these drivers may face on their own when not partnering with a major carrier. With equipment currently in such high demand, it can be difficult for a driver to find a tractor at a fair price, and most of the time, a driver might not have the credit history to be able to purchase a truck from a dealer directly.
A used truck can cost between $50 to $100 thousand. A new 2023 tractor can cost around $170,000, but depending on the driver’s credit score, a dealer may require up to 50% as a down payment. Most applicants can’t afford such a high payment, especially when they’re trying to start their own business.
“PGT’s Lease Purchase Program allows drivers who typically wouldn’t be approved for bank financing to finance through PGT instead,” said Chad Marsilio, PGT Trucking Chief Operating Officer. “Cost and accessibility of equipment are very big barriers for drivers to enter and grow in the industry, but at PGT, we can remove those challenges.”
In addition to assisting with affordable equipment, PGT also offers discounts on fuel and parts. If the truck does need repairs, PGT has a dedicated breakdown team to schedule maintenance quickly and reduce driver downtime.
“Right now, everything is so expensive for an independent truck driver who has to pay for his or her own equipment, maintenance, repairs, fuel, etc. Most drivers can’t afford to jump right into truck ownership, and that’s why they consider partnering with a carrier like PGT,” said David McKolosky, Lease Purchase Manager at PGT Trucking. “We can provide drivers the opportunity to lease a truck with us, and as they work toward ownership, they are able to benefit from our insurance and fuel discounts to help combat these high prices.”
There are minimum requirements to enter PGT’s Lease Purchase Program. A driver must have at least one year of flatbed driving experience and six months of hauling steel coils. Marsilio states that drivers must be knowledgeable and comfortable securing the commodities they will be hauling, as safety is a priority at all times.
Once a driver enters PGT’s Lease Purchase Program, they will pick up a fully prepped and clean vehicle. Although the truck is used, PGT ensures the equipment has been well cared for and maintained. Unlike some lease purchase programs where the equipment is bought at auction, every piece of equipment leased within PGT’s program was purchased by the company originally.
“Many other trucking companies purchase their lease equipment through auctions and don’t have the maintenance history on the trucks. PGT rotates our company equipment pretty regularly, so the tractors in our lease purchase program are late-models,” said Marsilio. “We know the full history of each truck and its value, so we can ensure it will be a solid piece of equipment for our drivers.”
From the time the driver signs on to the program and picks up the truck, they will immediately be assigned a load and start to make money. PGT also waives the first four weeks of tractor payments and does not require any type of down or balloon payment – something to look for when considering a lease purchase program. This allows the driver to get a feel for ownership and transition into the program without immediate costs.
“Drivers want to own their own trucks. Our program gives them a chance to have the proper financing that they might not be able to afford otherwise,” McKolosky said. “We don’t require down payments or balloon payments. All we do is offer a truck and the driver is able to run our freight and make weekly payments until it’s their own truck.”
According to McKolosky, most drivers have their trucks paid off within 42 months, but some in the program are successfully working to have them paid off in less than 12.
“We want our drivers to be successful, and we work to make the transition from company driver to owner-operator as smooth as possible through our lease purchase opportunities,” McKolosky said. “A lot of trucking companies treat their drivers like a number — not here. There are 112 drivers in our lease purchase program, and 112 of them can call me at any time, day or night, for assistance.”
Both Marsilio and McKolosky believe a lease purchase program is a way to combat the driver shortage and poor retention rates in the industry.
A 2020 Truth About Trucking survey showed that 77 percent of drivers do not complete their lease-to-own program. According to McKolosky, this year alone, six PGT drivers in the lease purchase program have paid off their trucks, and five more drivers are projected to complete their leases by the end of 2022.
“Most trucking companies don’t have a career path for a driver, but we do. We can offer to start the most basic driver out of a school in a company driver position, and they can advance from there,” said Marsilio. “Drivers have the opportunity to meet their career goals while staying at PGT instead of joining another carrier.”
At PGT, drivers can start as company drivers using company equipment and work their way into ownership through the Lease Purchase Program. As an Owner-Operator, drivers can then advance into fleet ownership and eventually develop their own agency, all while partnering with PGT.
“Our Lease Purchase Program works. Drivers can do it and achieve their independence, and we will back them 100%,” said McKolosky. “We help our drivers succeed.”
PGT expects to add new equipment to its Lease Purchase Program this summer and continue growing their fleet. The goal is to have 135 lease purchase operators in the program by the end of the year to continue supporting prospective owner-operators.
Making the move from company driver to an owner operator takes planning, research and support. The trucking industry opens a lot of doors for business owners who want to work hard and make a great living. A quality lease purchase program can help a driver meet their professional and financial goals. Being selective in equipment and in partnerships can pave the way to success.