Maintenance costs become a 'permanent headwind,' up 30%

Dive Brief:

The average fleet Class 8 truck ran 33,637 miles between unscheduled maintenance or breakdowns, according to a quarterly report on the first three months of 2020 put out by the American Trucking Associations' (ATA) Technology and Maintenance Council and FleetNet America. The study divided fleets into three areas: truckload, less-than-truckload and tanker fleets.
FleetNet said fleets have the ability to lower the costs and regularity of roadside breakdowns, by adopting new maintenance practices. Truckload firms, whose trucks are on the roads for long stretches, have the greatest opportunity, according to FleetNet. The study found the best-in-class TL firm ran 300% more miles between breakdowns than the average TL firm. The average cost of a mechanical repair was $491, 30% more than Q4 2019.
The best-in-class tanker fleet ran 21% longer between unscheduled maintenance or breakdowns, indicating the average tanker fleet could match that performance. LTL firms were outpaced by their best-in-class firm by 11%.

Dive Insight:

Maintenance costs have been shooting up for months, according to FleetNet. Unscheduled maintenance costs are up 30% from Q4 2019. In February, FleetNet and TMC reported that breakdown costs jumped 25.7% in Q4 2019, year over year.

During the first quarter of 2020, five types of maintenance problems accounted for almost 70% of the total unscheduled roadside repairs, according to the news release. The top four systems were the same as Q4 2019: tires, brakes, lighting and power, with exhaust systems coming in fifth for Q1 2020.

Tires are usually the No. 1 problem for the three carrier categories, but FleetNet and TMC reported for the first time one of the categories didn't see this trend. Truckload segments saw an increase in miles run between tire breakdowns, pushing tires to the second place.

"It was interesting to find the truckload vertical, who has been in the program the longest, continues to improve their miles between breakdowns," said Jim Buell, EVP of sales and marketing for FleetNet, in a written statement. "We believe that the availability of this data has contributed to this improvement."

But cost per repair looks like a "permanent headwind our industry is facing," said Robert Braswell, TMC executive director, in the news release.

The occurrence of roadside repairs vary across the three sectors.

The reason TL fleets have more maintenance issues is because they are away from their shops the longest. LTL fleets visit home base more often, so their breakdowns happen less. Tanker fleets have shrunken their breakdown gaps.

In Q1, LTL fleets went 55,407 miles between breakdowns, according to FleetNet and TMC. That compares to 57,012 miles in Q4 2019. TL fleets went 14,991 miles between breakdowns, compared to 14,333 in Q4 2019.

Tank fleets went 21,591 miles between breakdowns, compared to 37,630 miles in Q4 2019. Buell told Transport Dive in February that the poor performance in Q4 2019 was due to one fleet performing poorly. TMC and FleetNet do not disclose the names of the fleets who take part in the survey.

Buell has long advised fleets to learn from the best in class. And using more advanced data analysis could help. "The difference is some fleets are making use of data and some are not," Buell said last year at ATA's National Accounting and Finance Council's annual conference.

One reason for the costs could be out of the control of fleets. Buell told the NAFC that there is a shortage of technical and maintenance workers, and that it has to be addressed.