Fleet Concerns Remain Dynamic for 2024, TMC Data Says
[Find the latest in equipment & maintenance: Explore this quarter's issue of Calibrate]
The things that keep fleet managers up at night continued to shift through the end of 2023, according to a recent survey conducted by American Trucking Associations’ Technology & Maintenance Council — at least when it comes to TMC fleet members’ top maintenance worries.
More than 400 members were asked to share their top five concerns in the fall, based on a list of 85 possible choices. Of those responding, the following were identified as the top concerns in descending order, even though the list did not prove to be a clean top five:
1. Technician staffing
2. Aftertreatment
3. Roadside breakdowns
4. Data management, new technology challenges, vendor reliability (tie)
5. New equipment availability
Braswell
While Nos. 3 and 4 appeared in the list for the first time, new equipment availability returned to the top five after its absence in the summer of 2023 list. It appeared in the top five in the spring of 2023.
The list changed from the last time TMC surveyed fleet members on this question in the summer of 2023. Then, members said their top five concerns were:
1. Cost containment
2. Aftertreatment
3. Technician shortage
4. Technician staffing, parts shortage/availability, and emissions (tie)
5. Outsourcing, reliability, technician recruitment (tie)
The fact that cost containment topped the list by the end of last summer is consistent with recent data that appeared in the latest Decisiv-TMC North American Service Event Benchmark Report. The study said that parts and labor expenses rose 1.9% during the third quarter last year. The increase followed a 1.3% decline in the second quarter across the top 25 Vehicle Maintenance Reporting Standards level codes.
More Q2 Calibrate
►Work Continues on Establishing PC-12 Oil Category
►Freeze: Balancing Out the Future
►Fleet Concerns Remain Dynamic for 2024, TMC Data Says
►Baxter: Volvo’s 2024 VNL: Surprising Electrical, Mechanical Changes
Explore the Issue!
The jump in costs reflects an equal rise in parts and labor expenses — both of which increased 1.9% individually during the third quarter. On a year-over-year basis, parts costs are up 0.9% and labor costs climbed 4.9% for a total combined increase of 2.5%.
The fact that cost containment has disappeared off the top-five list in the fall of 2023 survey might indicate that the parts and labor trend may well have reversed itself once again, and bring fleets better news once all the data from the fourth quarter has been tabulated. That being said, seeing new items on the list indicates fleet managers are dealing with different problems than they did during the COVID pandemic, with roadside breakdowns, vendor reliability and new technology challenges becoming more of a concern.
An update to the report was presented during TMC’s 2024 Annual Meeting and Transportation Technology Exhibition, which stated combined parts and labor expenses fell 1.4% during the fourth quarter.
In the latest Decisiv-TMC North American Service Event Benchmark Report, TMC and Decisiv found that across 25 key VMRS systems, parts and labor costs dipped in the final quarter of 2023, reversing a 2.1% increase the previous quarter.
“We are still facing an industrywide challenge to find technicians, which is increasing labor costs for fleets and service providers. However, quarterly and annual parts cost decreases, driven by a reduction in pricing pressures and the influx of more new trucks, is bringing some welcome relief,” Decisiv President and CEO Dick Hyatt said. “With the Decisiv-TMC Benchmark Report, TMC members have the parts and labor data they need to better analyze costs and continue implementing practices that will help them gain efficiency and become even more productive.”
The decrease was driven largely by parts costs, which dropped 2.2% in the fourth quarter, while labor costs fell 0.2%. While quarter-over-quarter parts and labor costs both declined in the last three months of the year, the parts-to-labor ratio held steady at about 1.5 for the past year.
On a year-over-year basis, combined parts and labor costs in the final quarter of 2023 were 0.2% higher than the same quarter in 2022. However, in the annual comparison, a 2.2% drop in parts prices was offset by a 4% rise in labor costs.
Hyatt
With the most recent quarterly change, while labor costs decreased, the decline was at a slower rate. The higher labor costs relative to parts pricing and the year-over-year rise likely points to an ongoing need to spend more to attract technicians.
That industrywide challenge for fleets and service providers is expected to continue as baby boomers age and fewer workers enter vocational education programs. The U.S. Bureau of Labor Statistics reported that diesel service technician employment is projected to grow 4% from 2021 to 2031, creating about 28,500 openings for diesel service technicians each year, on average, over the decade. According to the TechForce Foundation’s Transportation Technician Supply & Demand Report, 177,000 new entrants in the diesel technician field are needed between 2022 and 2026.
Lower parts costs may reflect a decline in freight tonnage, leading to a decrease in mileage for trucking companies. The For-Hire Truck Tonnage Index from ATA for 2023 showed a 1.7% drop compared with the previous year. That figure, the largest decrease since 2020 and the only year since that tonnage contracted, represents a sizable drop for the trucking industry, which hauls more than 11 billion tons of freight annually.
Alex Clementi (right), who leads the asset management team at Decisiv, shows off the new Decisiv SRM Sentinel platform to Tico's David Hough (from left) and Madeline Waite at the 2024 TMC Annual Meeting and Transportation Technology Exhibition. (Connor D. Wolf/Transport Topics)
The data that Decisiv collects and analyzes for the Decisiv-TMC North American Service Event Benchmark Reports on 25 VRMS system level codes accounts for more than 97% of total parts and labor costs for more than 7 million assets and over 300,000 monthly maintenance and repair events at more than 5,000 service locations.
TMC issues the reports to its fleet members. The reports are organized based on the council’s VMRS sorted by VMRS-coded vehicle systems and geographic location.
TMC fleet members receive the quarterly Parts and Labor Report electronically via email. For more information on joining TMC, call (703) 838-1763 or visit http://tmc.trucking.org.
Want more news? Listen to today's daily briefing below or go here for more info:
