We’ve put together this article to help owner-operators and small fleet managers who may be struggling with that age-old question: “Should I buy a used or a new truck?”
Pros of buying a new truck
The decision of whether to buy a used or new truck is mostly a matter of expense. Buying a new rig is obviously significantly more expensive than buying a used one. Besides the higher truck cost, you may be paying for warranty costs and interest costs built into your payment plan. The question you must answer is: Is that higher expense worth it?
So what are the pros of buying new? A few of the major pros are:
Extensive warranty. Most new trucks come with a lengthy and extensive warranty covering all sorts of damage or issues. This can provide major peace of mind and save you money on any damage or repairs.
Full knowledge of truck’s history. This is another big reason people like to buy new. When you buy used trucks, there are always going to be some unknown issues. And you hardly ever can know exactly know how well-maintained the truck has been, or what issues have come up with it. But when you buy new, you’re in complete control and, as long as you know you will take good care of it, you’ll probably get a long, great life out of the truck.
One could make the argument that buying a new truck, although it’s obviously a lot more money, makes up for that cost in saving the money on maintenance that you’d have with a used truck. Buying a used truck is always a bit of a gamble, and this is why a lot of people prefer new.
But gambles can be smart, too. Let’s look at some pros of buying used.
Pros of buying a used truck
Buying used is very popular for owner-operators, especially new owner-operators. Let’s look at the major pros:
Used is significantly cheaper. The price drops off greatly for used trucks. Most of the depreciation happens in the first few years. A new truck might be $150,000 and then be sold used for $100,000 a couple years later, and $75,000 a year after that. Many trucks in about the 10-year-old range can be gotten for $20-$30,000.
Lightly-used can be just as good as new. Provided a truck isn’t that old, and provided you have good knowledge about how it’s been cared for and that it’s in good shape, a used truck can be nearly the same quality as a new truck.
Less risk. Because you’re putting up less money and you don’t have high payments to make, buying used means you can change course more easily. If you need to change careers, or take another job, or if you run into financial difficulties, buying a used truck means you can more easily change tack. Buying new can make that more difficult because you’re more invested and selling the truck in the first few years means you lose a lot of the money that you had invested in your long-term relationship with the truck.
More powerful. Some drivers prefer older trucks because many of the older trucks are more powerful and more sturdily built than some of the new trucks. If you prefer older trucks for this reason, it’s important to do the research to see if this is true for the model you’re looking at. (You can start your online research by doing an internet search for: ‘MAKE MODEL reviews’ and you should find some reviews of that model on truck-related sites and forums.)
Of course buying used has its downsides, too, as we’ve mentioned. It’s always a bit of a gamble and you can never be completely sure what has happened in a truck’s past. But if you do your research and do your best to verify a truck’s quality, there’s a good chance you’ll get a good truck.
What’s the best choice for you?
Buying used is the more popular choice for owner-operators, especially for newer owner-operators. Ray Haight, a former owner-operator who’s now a transportation consultant, had this to say on the subject: “I know plenty of owner-operators who have done very well buying a brand new truck, but the majority of them do very well with a used truck.” (Source: 2011 YouTube video from TruckNews.com)
So who buys new trucks? A new truck might make sense if either of the following are true:
- You are an experienced operator and know what you need and what you expect to make.
- You have a good amount of money to invest, and are confident you’ll be in the business for a long time.
Basically, if you want to buy a new truck, you have to be in it for the long haul (no pun intended!). If you have doubts about whether you’re definitely going to stay in the business, or doubts about whether the income will be there, you should probably take the safer bet and go with used.
Researching used trucks
If you decide to buy used, you should do your homework and research the truck extensively. This includes researching the model of truck online for potential issues as well as checking out the truck in person. In another article we wrote, we go into detail on some of the checks and tests you can do on used trucks to verify their quality.
Another factor can be fuel efficiency. Newer models of truck generally get better miles per gallon. The science is always improving, not just in terms of engine efficiency but also in terms of aerodynamics. If you are going to be running a lot of models, it’s worth considering the money you may be able to save by getting a new, fuel-efficient truck.
Pros and cons synopsis
Hopefully this article has been helpful in your truck-buying process. In future articles, we’ll discuss some specific strategies for owner-operators who are in the truck-buying stage.
If you have any comments or questions about this article, or want to learn more about how our software, Rigbooks, can help you with your owner-operator business, send us a message on our Contact Page.
My name is Jason Forrest, and I’m the creator of Rigbooks. Rigbooks is a cloud-based software that makes it easier for small and medium-sized trucking companies run their business while keeping organized. We’ve been around since 2010.
A little about me: I grew up in a trucking family and from an early age I learned about the day-to-day problems that truck owner/operators have to deal with. I was into computers and programming as a kid so over the years I helped write small computer programs that helped my parents run their company better. Eventually that led to the idea of putting all those tools together in one package. And Rigbooks was born.
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More resources for trucking business owners:
- What’s the difference between HVUT, Form 2290, and IFTA?
- "How long do I have to keep these?": FMCSA record retention for owner-operators and small fleet owners
- Top tax filing tips for owner-operators
- Tips for owner-operators with tax problems
- How are fuel surcharges calculated?
- Simple rules for maintaining long-term profitability in your trucking business
- Starting out with an owner-operator trucking business
- Owner-operator expenses: Fixed costs vs variable costs
- Understanding owner-operator expenses and costs
- Gaining half an MPG can put more money in your pocket than adding $90,000 in revenue
- Cutting fuel costs and improving fuel efficiency for Owner Operators
- Top truck-buying tips for owner-operators
- New versus used truck pros and cons table
- Buying a truck: Should you get a new or used rig?
- Preventative maintenance strategies to avoid major repair costs
- IFTA fuel-buying strategies: Where is the best place to buy fuel?
- Calculating your cost per mile
- Owner Operator Expenses - Fixed Costs vs Variable Costs
- How do I calculate IFTA?
- How does IFTA work?
- How did IFTA start?
- What exactly is IFTA?
- Tracking miles for IFTA
- Fitness for the road
- Acronym cheatsheet for the trucking industry