Positive Trends Emerge in Heavy-Duty Truck Repair Costs - Manifest Global Logistics | Truck Dispatch Services in North Carolina

Published September 20, 2023

In some welcome news for the trucking industry, a recent report from the Technology & Maintenance Council of American Trucking Associations and Decisiv Inc. has shed light on a noteworthy development. During the second quarter of 2023, parts and labor expenses in heavy-duty truck repair shops saw a decline.

According to Decisiv President and CEO Dick Hyatt, this positive change is attributed to various factors. “With rising build rates for new equipment and less mileage reducing the need to operate aging trucks, fleets are finally seeing a definite improvement in parts and labor costs,” Hyatt stated in a news release on September 17th.

This promising information is part of the Decisiv/TMC North American Service Event Benchmark Report, which relies on data collected and analyzed using TMC Vehicle Maintenance Reporting Standard system codes. Here’s a closer look at the key findings:

Cost Reduction: After a period of sustained cost increases, the combined expenses for parts and labor, specifically for the top 25 VMRS codes, decreased by 1.3% in Q2 compared to Q1. This noteworthy change suggests that fleets are experiencing some financial relief.
Labor Costs: Interestingly, labor costs decreased for the first time in the past year, which is a significant shift in the trend.
Parts Costs: Parts costs also exhibited a decline for the second consecutive quarter, which is a positive sign for fleet operators.
Year-Over-Year Comparison: When comparing Q2 of this year to the same period last year, combined parts and labor costs showed a more modest increase of 5.6%, in contrast to the steep 15% year-over-year increase reported in Q2 2022.

These findings indicate a potential return to normalized trade cycles and greater predictability in service and repair costs, which can be seen as a boon for the industry.

Hyatt also pointed out that the detailed data and reporting enabled by Decisiv SRM provide fleets and service providers with the means to identify strategies for further cost reduction.

TMC Executive Director Robert Braswell emphasized the importance of this data for the council’s fleet membership, stating, “The council’s fleet membership will benefit from this important parts and labor cost analysis and plan accordingly going forward.”

However, it’s worth noting that while parts and labor costs are improving, economic and inflationary pressures still push them to comparatively high levels. On a brighter note, supply chain operations of OEMs are showing signs of improvement, which is helping alleviate some pressure on production capacity. As demand eases, fleets are receiving more new trucks.

The report also highlights how various factors interact and influence service activity. Factors such as changes in mileage due to fluctuations in freight volumes, the performance of newer versus older trucks, and the stabilization of the supply chain all play a role in impacting fleet service operations.

Looking at the specific breakdown of costs, data on the top 10 VMRS code categories reveals that engines and related systems accounted for the largest share of expenses in the second quarter. Powerplant costs led the way at 35.9%, followed by exhaust at 12.9%, cooling at 6.1%, and fuel systems at 5.3%. Collectively, these categories represented 60.2% of costs during the quarter.

The Decisiv/TMC North American Service Event Benchmark Report draws its data from the Decisiv SRM platform, which tracks service and repair events for more than 7 million commercial assets operating across the U.S. and Canada. Currently, the system manages a weekly average of 70,000 service events at nearly 5,000 locations.

In conclusion, the recent data paints a positive picture for the trucking industry, with a clear trend of decreasing parts and labor costs. While challenges persist, such as economic pressures and supply chain fluctuations, this report offers a glimmer of hope and stability for fleets and service providers. It remains essential for industry stakeholders to adapt and plan strategically in response to these evolving dynamics. For those interested in delving deeper, the full report is available to TMC members.