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AB5 & Owner Operators

Since the California trucking community must comply with AB5, many truck drivers are going to see the owner operator route as a viable alternative to working with a larger carrier. As an owner operator, these truck drivers will be fully independent in their work, pick up their own freight, pay their own expenses and keep 100% of the money that they make from each load. We are going to go over how someone can start their trucking business in California and find owner operator jobs out on the road.

What are the steps to become an owner operator in California?

The first step that a truck driver needs to take in order to become an owner operator is to set up the business and obtain operating authority. On the subject of operating authority, carriers can either get interstate or intrastate authority. In order to haul freight in between states or do any intermodal business, they would need to obtain interstate authority, which is done by acquiring both DOT and MC numbers. In setting up the business, most owner operators will go the LLC route. Since a lot of freight in California comes from the ports, owner operators should also consider getting a TWIC card so that they can access the ports.

Once the owner operator business is set up, carriers generally need to get set up with liability insurance and cargo insurance to protect themselves in case of emergency. In order to use the DrayNow app to haul intermodal freight, carriers need to have $1 million in general liability insurance and $100,000 in cargo insurance.

CARB Compliance

Any owner operator that is operating in California must also be California Air Resource Board (CARB) compliant. CARB compliance deals with emissions standards set by the state, and any truck that is hauling intermodal freight needs to be CARB certified. Before getting certification, know that by 2023, all trucks need to have a model year of 2010 or newer.

When someone finally has their authority, company and insurance all set up, they can fully operate on their own! The only other step would be figuring out how many trucks to purchase and utilize for their operation. Note that because of AB5, any drivers that a carrier wants to bring into the business would have to be considered an employee.

As completely independent truckers, owner operators need to go out and find their own freight. That’s where load board apps like DrayNow come into play. The DrayNow app has local intermodal loads for carriers in many markets, including Los Angeles and Northern California. Owner operators and small carrier companies can get started by downloading the free app and signing up.

In the age of AB5, trucking is completely changing in the state of California. Becoming an owner operator can give anyone a head start in conquering this new frontier.

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