Trucking Still Squeezed by High Costs and Low Rates
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The average cost of operating a truck dipped slightly last year, but marginal costs jumped when the effects of lower fuel costs were excluded, the .
The group’s latest found that the average cost of operating a truck last year slipped 0.4% versus year-ago levels to $2.260 per mile. That said, when lower fuel costs are excluded, marginal expenses increased 3.6% to $1.779 per mile, a record for non-fuel operating costs, ATRI said.
“The trucking industry is facing the most challenging freight market in years, with loads down and costs increasing,” Groendyke Transport CEO Greg Hodgen said. “ATRI’s Operational Costs data and the customized benchmarking report that compares us to similar fleets are more critical than ever as we navigate rising costs and decreasing margins in this adverse environment.”
The study found that cost trends varied by line item last year. For instance, fuel, repair and maintenance expenses declined year over year, but driver wages rose 2.4% — half a percentage point below inflation. ATRI pointed out that driver wages were the primary contributor to cost increases for trucking in the three years following the coronavirus pandemic.
Other cost drivers were truck and trailer payments, which rose 8.3% to a record-high 39 cents per mile, while driver benefits costs rose 4.8% to nearly 20 cents per mile. Non-driver staff was cut by 6.8%.
The report noted that carrier profitability suffered across all industry sectors, as average operating margins were below 2% in every sector besides less-than-truckload. The industry’s persistent freight recession contributed to a 2.2% drop in truck capacity as carriers sold trucks, while empty miles rose to an average of 16.7%. The number of drivers per truck fell to 0.93 as carriers parked trucks. Truckload carriers had an average operating margin of negative 2.3%, ATRI said.
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Still, the report noted that average truck age, average dwell time per stop and mileage between breakdowns all improved — “testaments to industry performance despite economic headwinds,” it said.
“While parts of the U.S. economy maintained positive growth rates, those sectors lacked the catalyst necessary to reverse the multi-year trucking downturn that followed the post-pandemic boom,” ATRI said. “Unfortunately, in trucking and specifically in the dry van, flatbed and refrigerated sectors, nationwide contract and spot freight rates continued to slide over the year.”
