Owner Operator Class 8 Operational Costs

Owner Operator Class 8 Operational Costs

Owner Operator Operational Expenses

How Fuel Costs Vary With Operations – Using a Typical Class 8 Over-the-Road Tractor-Trailer As An Example
Think about all of the things you can do as you roll down the road!!!

 

 

BACKGROUND

As a successful truck operator, it is important to understand the effect of your operations on profitability. We wanted to show an example of typical equipment in an operation and go through some of the variables.

We based this example on an aerodynamic 18-wheel truck with a smooth side van trailer, operating at 60 miles per hour (MPH) with 80,000 pounds gross vehicle weight.

This results in a truck getting about 6 miles per gallon (MPG).

We then varied each parameter to show the relative effect (MPG and cost) from this baseline.

For comparative purposes, we showed first the effect of what you do in every day operations. We followed that with what happens when outside parameters (wind, etc.) affect operations. Basic specing issues are addressed under “Industry Services – Equipment Specifications.

Note: This information was compiled from various industry sources and actual operations. It was averaged for discussion and planning purposes. It may vary slightly when compared to individual representations from operators, manufacturers and suppliers. Annual costs are calculated for operations averaging 2,500 miles / week.

YOUR OPERATION

– Speed has the largest effect on your operational cost. Every 5 MPH costs about 0.5 MPG or $0.02 per mile in fuel. If you are running 75 MPH and slow to 65 MPH, that is 1 MPG or $0.04 per mile or over $6,000 per year savings. Note: This is based on a fuel cost of $1.20 per gallon. As prices go up, this cost (and savings) multiplies!!!

– Speed also has wear costs. That same 10 MPH saves about 10% in tire life (tires running cooler); 10-20% in engine life (depending on engine size), 20% in brake life (not slowing for others) and stress / wear on you.

– Idle time also has a notable effect on costs. With an average idle time of 10 hours per day (heater, air conditioning, TV / VCR…), this costs about 0.6 MPG or $0.02 per mile or about $2,500 per year. Minimizing idle can help.

– Running your engine fan all of the time costs from 10 to 40 HP. This can cost up to 0.3 MPG or about $0.01 per mile or $1,200 per year. (Yes, some still do it)

– Alignment doesn’t affect fuel mileage much (0.1 MPG), but it reduces tire life up to 50%.

– Tire pressure also doesn’t affect fuel mileage much (0.1 MPG), but it also can reduce tire life up to 30%.
OUTSIDE FACTORS

– Wind seems always to be going a different direction than you are. It can cost you up to 1.5 MPG, over $0.05 per mile or over $7,000 per year. The rule is to just slow down.

– Extreme temperatures (hot or cold) can cost up to 1.0 MPG, over $0.03 per mile or over $4,000 per year. The rule again is to just slow down.

– Running mountains versus the flats can cost up to 1.0 MPG, over $0.03 per mile or over $4,000 per year. The key here is to take it easy both up and down the hills.

– If roads are rough or soft, your mileage can be affected up to 0.6 MPG, about $0.02 per mile or about $2,500 per year. Again, slowing down is the key thing to do.

– Blended fuel can cost up to 0.5 MPG, over $0.01 per mile or about $2,000 per year. That is just one reason why we see mileage drop in the winter.

– As you find in the Surcharge Overview, the rule of thumb for both shopping fuel prices and assessing surcharge is “Nickel = Penny.” In other words, a nickel ($0.05) per gallon diesel fuel price change equals a penny ($0.01) per mile change in your cost per mile. That means that a swing of $0.40 per gallon fuel cost was about $0.08 per mile or over $10,000 per year.

– If you are running light loads or a significant amount of deadhead, you should experience a notable increase in fuel mileage. The same truck noted in the beginning of this example with a gross vehicle weight of 40,000 pounds (almost empty) should see an increase of about 1.5 MPG or over $0.05 per mile in fuel savings.
Note: You can use this to adjust to your actual operation.

Some helpful tips again

Slowing down a little saves a lot — 5 MPH = $0.02 per mile
Minimize your idling — 10 hours per day = $0.02 per mile
Keep an eye on your alignment and tire pressure (tire life)
Shop for your best fuel value — $0.05 per gallon = $0.01 per mile
Spec the right equipment for your operation
Get help from industry suppliers

 

NEXT – Your Net Profit  (Take-em-Home!!!)  CLICK HERE

Owner Operator Net Profitability

 

 

 

Printed with permission – Transportation Business Associates Business Services for the Transportation Industry Transportation Business Associates Copyright © 1996-2010 P. O. Box 17531 Denver, Colorado 80217-0531