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For the first time since ATRI began tracking operational
costs, trucking crossed the $2 per mile mark in 2022, settling
at $2.251 per mile — a 21.3% increase over 2021.
Hourly operations expenses also broke a record in 2022.
According to the report, the report showed the cost of operating
a truck in 2022 was $90.78 per hour — a 21.6%
increase over 2021. The increases in both measurements
stem from several double-digit increases in cost components.
“Our carriers are definitely aware of and feeling the pain of
increased and rising operating costs” said Amanda Pearson
of the Truckload Carriers Association (TCA). Pearson serves
as facilitator for the TCA Profitability Program (TPP).
In 2022, fuel costs had the greatest impact on overall
operations, rising a whopping 53.7% over 2021. But the
increase was joined by growth in truck/trailer lease and
purchase payments (18.6%), driver wages (15.5%), repair
and maintenance (12%), tires (9.8%), truck insurance premiums
(2.3%), and driver benefits (0.5%). Only permits and
licenses (-6.3%) and tolls (-12.5%) decreased in cost compared
to the previous year.
In terms of fuel, Russia’s invasion of Ukraine in February
2022 had a major impact on diesel costs. While the price
of fuel began to slide during the second half of the year, it
did not reach pre-invasion prices before the year’s end. Fuel
prices topped $5.50 per gallon in July 2022 and hovered at
nearly $4 per gallon as of the ATRI report’s ending date of
May 2023.
“Carriers are working hard with OEMs to maximize fuel
savings,” Pearson said. “Reduced speed, limiting idle
time, trip planning, and adaptive cruise control are being
employed to recognize the most savings. Companies have
rolled out mpg expectations and bonus programs to support
improvement.”
Shepard Dunn, program manager for TPP Benchmarking,
echoed Pearson’s thoughts, noting additional steps carriers
are taking to decrease costs across the board.
“Carriers are revisiting all supplier pricing,” Dunn said.
“Some are resizing fleets and changing networks for better
efficiencies.”
Carriers are also educating employees on “cost awareness,”
maintaining that employee productivity impacts operating
costs. From a technological standpoint, Dunn said,
automating as many processes as possible is a proven cost
savings tool.
“Carriers are having to question every cost they have and
decide whether or not (the costs) are justified,” he said.
From the perspective of equipment costs, the ATRI report
notes that, “Carriers that acquired trucks in the first half of
2022, during a period of limited supply, paid a premium.”
In the early months of 2022, used Class 8 truck prices were
79.9% higher than the same period in 2021.
“Every carrier has been faced with substantial increases
in equipment costs,” Pearson said. “Not only did they battle
to receive units, [carriers] struggled to forecast and plan for
price increases.”
While companies and manufacturers work together to
catch up to market demand, Pearson noted that many industry
organizations, including TCA, support the repeal of
the federal excise tax (FET). This tax, which went into effect
in 1917, levies additional taxes on truck sales.
“We believe this tax hinders fleet investment and delays
the purchase of safer and more fuel-efficient trucks,” she
said.
The availability of new equipment in the latter half of 2022
tempered the increase in repair and maintenance costs.
Even so, the cost of maintaining equipment increased substantially
over 2021. The costs associated with repair and
maintenance were .196 cents per mile in 2022, bolstered by
parts and labor expenses increasing 13% over 2021 costs.
Carriers with larger fleets saw per-mile savings in repair and
maintenance costs, likely due to purchasing new equipment.
Still, parts shortages and increased labor maintained permile
costs at relatively high levels in spite of savings experienced
by larger carriers.
Tire prices, closely connected to global oil costs, also
rose in 2022. Overall, carriers of all sizes saw tire prices of
.045 cents per mile.
The price of liability insurance remained relatively steady
in 2022. Insurance costs were up only 0.2 cents per mile,
averaging 8.8 cents per mile for carriers. This represented
a 0.1% increase over the three-year average. The stability in
insurance costs is largely attributable to fewer miles driven
during the pandemic.
Even with more miles driven in 2022 — and a corresponding
increase in accidents and repairs — the COVID-19
pandemic period profits seen by insurance companies allowed
them to pass the savings on to the trucking industry.
The insurance savings did not carry over to small carriers,
however, as small, specialized fleets saw premium increases
of 1 to five 5 cents per mile.
A review of increasing operational costs and declining
freight rates emphasizes the importance of operational efficiencies
to carriers of all sizes. Empty mileage, dwell time,
and mpg are all critical in computing cost efficiencies, and
2022 saw trends offering a mixed bag for carriers of all
sizes.
Non-tanker “deadhead” mileage was up to 15.4% in 2022,
an increase of 0.7% over the previous year. Dwell time for
the industry was measured at 1 hour and 46 minutes per
stop, a nine-minute decrease over 2022. Still, dwell time
is listed in the Top 5 issues facing the industry in multiple
surveys of trucking professionals. Fuel economy was up
slightly over 2022, with trucks averaging 6.68 mpg. Speed
governor usage is credited as being largely responsible for
mileage improvement.
“Carriers are looking at every aspect of their operations
to ensure costs are in line,” Pearson said. “Companies are
diligently investing in technology and processes to increase
efficiency, ensuring their teams are right sized to provide
valuable service to drivers and customers, and aligning their
networks.”
TCA SEPTEMBER/OCTOBER 2023 www.Truckload.org | Truckload Authority 21