In November 2019, the American Transportation Research Institute’s Operational Costs of Trucking report indicated that fleet operating cost hit an average of nearly $72 per hour — an amount causes a considerable amount of stress for many fleets. With operational costs on the rise, many trucking companies are looking for ways to decrease operational costs.
According to the ATRI report, the average marginal cost per mile increased by 7.7% in 2018, reaching $1.82 per mile. Those costs include:
Driver wages and benefits
In every category except for tires, costs increased substantially throughout 2018. Fuel costs saw the largest increase at nearly 17.7%, with insurance costs coming in a close second at 12%. Between 2012 and 2018, repair and maintenance costs increased 24%, leaving fleet owners paying around 17.1 cents per mile.
Your costs per mile may vary based on a variety of factors. For example, larger fleets may have slightly lower maintenance costs or get a break on their overall insurance. Further, you may have specific operational costs for your fleet, especially if you’re transporting bulky or hazardous materials. A firm understanding of your personal average cost per mile can often help you set prices, pay your drivers, or develop your budget for the coming year.
While you can’t eliminate most of the basic operational costs for your fleet, you can take steps to minimize many of them, putting yourself in a better position to manage your budget. Try some of these suggestions for reducing your general operational costs.
Drivers can take several steps to improve the overall fuel efficiency of their driving — and those steps can add up substantially over the course of multiple trips each week, each month, and each year. Raise driver education and training to improve their awareness of those steps, including:
Driving smoothly, avoiding both fast acceleration and sharp braking. Smooth driving can go a long way toward improving overall fuel efficiency as well as decreasing the need for maintenance on some vehicles. Drivers should try to both accelerate and brake smoothly when possible.
Avoiding over-revving. Instead, drivers should change gears to reduce speed.
Maintaining a safe speed on the roads. Speeding can increase fuel consumption by as much as 10% — a substantial change in big trucks.
Planning out routes ahead of time can help drivers avoid extremely congested areas, where stop and go traffic can substantially decrease fuel efficiency.
Reactive maintenance can quickly become one of the biggest expenses for your fleet — especially if you let small problems go until they become much more serious issues. Addressing faults early prevents them from worsening or, in a worst-case scenario, becoming too expensive to fix, which means you may have to replace the vehicle completely. Preventative maintenance and regular vehicle checks, including both pre- and post-trip inspections, also help you remain in DOT compliance, avoiding the expensive fees that can come from violations.
You can improve gas mileage by around 0.6% on average, or up to 3% for some vehicles, just by keeping your tires inflated to the right pressure. Under-inflated tires can lower gas mileage by about 0.2% for every 1 psi drop in the average pressure of all of your tires. Properly inflated tires are also safer and last longer, with a lower incidence of blowouts. You should also:
Keep your engine tuned (an average 4% increase in fuel efficiency)
Changing the oil on time and using the right grade of motor oil (1-2% increase in fuel efficiency)
Replace clogged air filters in a timely manner
Instituting a system of checks and balances can make it easier to keep up with your overall vehicle maintenance. Your company needs a robust preventative maintenance program in place to take care of routine services and keep your fleet in great shape. Using an app can help schedule important routine maintenance and evaluations of every vehicle in the fleet and ensure that none of the fleet vehicles slip through the cracks. When preventative maintenance is routine, you’ll avoid many of the problems that come from mechanical failures, including increased accident potential and higher costs. These simple steps can ensure that your fleet gets the maintenance it needs to remain more fuel-efficient and keep it running safely and smoothly, reducing the odds of mechanical failure along with the risk of accidents caused by maintenance concerns.
When non-mechanical failure occurs–failures that are within the control of drivers, but that a driver did not avoid–hold the responsible driver accountable. Introduce a process that lets you clearly see which driver was responsible for the vehicle when the damage occurred and, if possible, what damage the driver caused. By introducing accountability, you may lower the number of insurance claims you make and, in many cases, increase the likelihood that drivers will take all the steps you require to keep your vehicles running more efficiently. Not only does this minimize your overall costs, but it can also help keep your insurance premiums lower, preventing you from experiencing higher expenses over time.
Technology can help you maintain your fleet and introduce driver accountability, from letting you know when you have a vehicle that’s due for routine maintenance to identifying the driver responsible for damaging a vehicle. Solid fleet management software can also streamline those pre- and post-trip inspections and make it more difficult for drivers to head out without making sure the vehicle is fully maintained and ready to go. Are you ready to start better managing your fleet and decreasing your overall operating costs? Start your free trial of Whip Around today, or contact us with any questions you have about fleet management best practices and how we can help you achieve your financial goals even as costs continue to increase.