Dive Brief:
- Parts and labor costs declined by 1.4% in Q4 from Q3, according to a report this week by the American Trucking Associations’ Technology & Maintenance Council and service management tech firm Decisiv.
- All 25 Vehicle Maintenance Reporting Standards codes saw cost decreases in the last quarter of 2023, the March 4 report said, reversing last quarter’s increases across 18 of the VMRS codes.
- In a year-over-year comparison, a 2.2% drop in parts prices was offset by a 4% rise in labor costs, the report said.
Dive Insight:
Trucking found more relief in parts costs than labor over the past year as a reduction in pricing pressures and an influx of new trucks continue to lower carrier costs, Decisiv President and CEO Dick Hyatt said.
The sequential decrease in Q4 was driven largely by a 2.2% drop in parts costs from the prior quarter, while labor costs fell only 0.2%.
“We are still facing an industry-wide challenge to find technicians, which is increasing labor costs for fleets and service providers,” Hyatt said in the announcement.
Lower parts costs may reflect a decline in freight tonnage, leading to a decrease in mileage for trucking companies, the report said. It cited ATA’s For-Hire Truck Tonnage Index, which showed a 1.7% drop in 2023 compared to the previous year.
Carriers have been weathering substantial increases for much of the last several years, as TMC Executive Director Robert Braswell pointed out.
“Lower parts and labor costs are welcome news to fleets,” he said.
