FOR IMMEDIATE RELEASE
Parts and Labor Costs Dropped in the Second Quarter of 2023
Benchmarking Report from TMC and Decisiv reveals improving news
for fleets and service providers.
American Trucking Associations’ Technology & Maintenance Council and Decisiv Inc., said that parts and labor expenses dropped during the second quarter of 2023, according to data released in the latest Decisiv/TMC North American Service Event Benchmark Report.
Between 2023 Q1 and 2023 Q2, after rising at a much slower rate than in previous quarters, combined parts and labor costs for the top 25 VMRS system level codes dropped 1.3 percent. Labor costs decreased for the first time in the past year and parts costs were down for the second quarter in a row. On a year-over-year basis, from 2022 Q2 to 2023 Q2 combined parts and labor costs rose only 5.57 percent, a dramatic reduction in the rate of increase of 15 percent seen one year earlier.
While economic and inflation pressures are still driving parts prices and labor rates to comparatively high levels, OEMs are effectively managing fewer supply chain disruptions that had negatively impacted production capacity. With the steady elimination of pent-up demand, fleets are finally taking delivery of new, less repair intensive trucks. Additionally, the influx of replacement vehicles and lower freight volumes are decreasing the demand for service and repair activity and consequently lowering parts and labor costs.
“With rising build rates for new equipment and less mileage reducing the need o operate aging trucks, fleets are finally seeing a definite improvement in parts and labor costs,” said Dick Hyatt, President and CEO of Decisiv. “The data that Decisiv collects and analyzes for TMC on Vehicle Maintenance Reporting Standard (VMRS) system level codes points to a return to normalized trade cycles and more predictable service and repair costs. Along with greater stability, the highly detailed data and reporting enabled by Decisiv SRM allows fleets and service providers to focus on ways to continue to drive down expenses.”
The data reflecting lower parts and labor expenses in this quarter’s Decisiv TMC Benchmark Report indicates how a number of factors interactively impact service activity. Changes in mileage related to freight volumes, the effect of newer versus aging trucks and the ongoing stabilization of the supply chain all impact each other and have a resulting effect on fleet service operations.
Looking ahead, there is a growing expectation that service and repair costs will find a new equilibrium and consequently settle into a more predictable cycle similar to what was experienced in the past.
Data on the top ten VMRS code categories shows that engines and related systems accounted for the largest percentage of all costs in 2023 Q2. In total, Powerplant (35.9%), Exhaust (12.9%) Cooling (6.1%) and Fuel Systems (5.3%) equaled 60.2% of costs in 2023 Q2.
“After many months of rapidly increasing parts and labor costs, we are pleased to see this positive trend in the maintenance expense data,” said TMC Executive Director Robert Braswell. “The Council’s fleet membership will benefit from this important parts and labor cost analysis and plan accordingly going forward.”
The Decisiv/TMC North American Service Event Benchmark Reports are generated using data from the Decisiv SRM platform on service and repair events for more than 7 million commercial assets operating across the U.S. and Canada. The industry’s largest asset service management system is being used to manage a weekly average of 70,000 service events at nearly 5,000 locations.
ATA’s Technology & Maintenance Council issues the reports to its fleet members. The reports are organized based on the Council’s Vehicle Maintenance Reporting Standards sorted by VMRS-coded vehicle systems and geographic location.
TMC fleet members will receive the report electronically via email. For more information on joining TMC, call (703) 838-1763 or visit http://tmc.trucking.org.
By providing leadership support and opportunities to collaborate, TMC helps members develop the industry’s best practices that address the critical truck technology and maintenance issues that have the greatest impact on truck fleets. For more than 60 years, TMC’s member-driven Recommended Maintenance and Engineering Practices have been setting the standards that help trucking companies specify and maintain their fleets more effectively. Follow TMC on Twitter, LinkedIn and Facebook.
Virginia-based Decisiv is the provider of the largest asset service management ecosystem for the commercial vehicle industry. The Decisiv Service Relationship Management (SRM) platform is the foundation for the nearly 5,000 service locations across North America that manage more than 4 million service and repair events for commercial vehicles annually. Through Decisiv’s SRM platform, dealers, service providers, manufacturers, and fleet and asset managers can communicate and collaborate during every service event. The SRM solution streamlines the entire asset service management process bringing all the necessary diagnostic, telematics and asset information together for all participants, and delivers it at the point of service. This level of connectivity and collaboration drives an unrivaled level of service performance and asset optimization that gets trucks back on the road faster so fleets see higher revenue per asset and lower costs. Service providers using SRM establish efficient communication, better controls, and increased productivity in service operations that enables them to become trusted partners to fleets. For manufacturers, SRM enhances the value of service networks and provides data and analytics to help develop more reliable and efficient commercial assets. For more information, visit www.decisiv.com.
American Trucking Associations is the largest national trade association for the trucking industry. Through a federation of 50 affiliated state trucking associations and industry-related conferences and councils, ATA is the voice of the industry America depends on most to move our nation’s freight. Follow ATA on Twitter or Facebook. Trucking Moves America Forward.
# # #