By Gwendolyn Brown
When fuel prices go up, margins go down. But that is not the total sum of the impact rising fuel costs have on the commercial truck and transportation equipment industry. Although the United States economy as a whole seems to be on the rebound, rising fuel costs have put pressure on small and large businesses alike. Firms such as delivery fleets can attempt to recover some of these costs by applying surcharges. For example, UPS and FedEx instituted a fuel surcharge and price increases early in 2005. However, in a typical vocational fleet, fuel costs represent a significant percentage of the truck’s operating cost, which can be difficult or impossible to recover.
While some might argue that the rising cost of fuel is merely a factor of doing business, significant shifts in fuel costs could mean the difference between survival and extinction of some or all of your delivery services. In a market of rapidly increasing fuel prices, you may postpone discretionary maintenance as a cost-cutting measure. However, skimping on maintenance may not be the most effective solution when factored into the overall operating cost of a vehicle that is not working at 100 percent of its capacity.
“Due to steadily increasing fuel costs, we’re seeing fleets that are slacking off on maintenance to the point that the vehicle will need to be replaced instead of repaired. We hear from a lot of customers who cannot afford to replace the vehicle and we are asked to ‘patch it up.’ However, equipment that takes a lot of abuse and is not properly maintained may have to be replaced to ensure the safety of the vehicle,” said Eddie Boyde, president of Action Fleet & Truck Equipment in Houston, Texas.
While the price of fuel may be affecting the bottom line, it is nothing compared to replacement costs in the long run. For this reason, it is crucial to work with your delivery drivers to determine the best ways to develop solutions that conserve fuel while still meeting your delivery needs.
Some suggestions on fuel efficiency to consider include:
- Avoiding vehicle overloading—Explain to your drivers how eliminating overall parasitic load (i.e., tools and other accessories unnecessary to complete the job) may reduce vehicle weight. Vehicle overloading also creates brake wear and potential safety concerns.
- Ensuring proper tire inflation—During maintenance and repair, check for under-inflated tires that create drag and reduce fuel-efficiency. Automatic tire inflation systems are required in some cases and may need to be considered in others.
- Creating a fuel management program—Encourage your vehicle operators to reduce unnecessary idling and unnecessary mileage. Many of these changes have very nominal tangible benefits, but when combined and employed regularly and by every one of your drivers, it will have a noticeable impact on gas savings.
- Outlining a maintenance schedule—The key to a good schedule is one that meets budgetary needs, but preserves the integrity of the vehicles in service. Engine and brake maintenance are critical to optimum vehicle performance and fuel efficiency.
With all these factors in mind, you can work to find the right balance between fuel cost savings and maintaining a fleet of delivery vehicles that is dependable. While long-term gasoline price increases may signal a need to seek more drastic measures, such as surcharges or other price increases passed along to the consumer, your short-term solutions shouldn’t compromise the safety or reliability of your vehicles.
About the author
Gwendolyn Brown is the Communications Director for the National Truck Equipment Association, the leading association supporting the $98.3 billion commercial truck and transportation equipment industry. The Association currently represents nearly 1,600 companies that manufacture, distribute, install, sell and repair commercial trucks, truck bodies, truck equipment, trailers and accessories. For more information, contact the NTEA at call 1-800-441-6832 or visit www.ntea.com