Over two thirds of all American goods are transported on trucks. This means the cost of trucking plays a direct role in what consumers pay at the store. Keeping trucking costs low is therefore important for the whole economy. However, the costs associated with trucking are not as simple as many people think, and one of the hardest aspects of running a trucking company is calculating costs so a competitive rate can be given to companies for shipping goods. This isn’t easy, as there is more to trucking than just paying for a truck and its fuel.
A single truck can cost over $180,000 to keep on the road each year. Over the average mileage of a commercial truck, usually around 130,000 miles, this equates to about $1.38 per mile, but the costs that make up this figure are varied.
Truck and driver
The most fundamental cost for any trucking company is the cost of the truck, trailer and the driver. Trucks aren’t cheap. The price of the average new cab can be well over $100,000, while a trailer, depending on length and type, can be over $50,000. However, properly maintained trucks can last for years, so the cost of the actual truck only equates to a fraction of the total running costs, around $0.24 per mile travelled.
Of course, every truck requires a driver or team of drivers to keep it on the road. Salaries vary, but typically the cost of driver per mile is around $0.36, which means the cost of the truck, cab and driver normally equates to around 42% of the total running costs of keeping trucks on the road, or $0.60 per mile.
Perhaps the largest expense for any trucking company is the cost of fuel. Over a year, a single commercial truck can use as much as $70,000 worth of diesel, which is around 20,500 gallons. Compared this to a standard road car, which uses around 500 gallons of fuel each year, and you’ll see just what a huge amount of fuel trucks can go through. The cost of this fuel per mile, depending on efficiency of the truck, is around $0.54. Around $0.07 of this figure goes on fuel taxes, which is a fairly small sum, especially when you compare US trucks to those in Europe, who often pay 60% tax on their diesel.
Repairs and maintenance
Keeping a truck on the road requires regular maintenance and repair. Trucks travel for hundreds of miles non-stop, pulling huge loads, which means parts can wear out quickly. Servicing needs to be done regularly, and new parts, repairs and general maintenance can cost in excess of $15,000 a year. Add to this the cost of new tires, around $250 each, which for an 18-wheeler is a whopping $4,500 for a new set, and the cost per mile of maintenance, parts and labor is around $0.15 per mile.
Insurance and other costs
Trucks require multiple insurance policies. First, there is standard truck insurance, which is taken out to pay for accidents, theft or damage to the truck. However, transport companies also need insurance to cover the load, which can vary depending on the type of goods the truck carries. Dangerous substances such as gasoline will cost more in insurance, while a stolen truck or one involved in an accident can see premiums rise substantially. However, the typical annual costs for all these different insurances is around $6,500 a year, or $0.05 per mile.
A few other costs are also involved in keeping a commercial truck on the road. Trucks often need special permits and licenses to carry certain loads, and on the road expenses such as toll roads and overnight stays all have to be added to the total running costs. Typically, these add up to another $0.02 per mile.
As we can see, there is more to the costs of running a commercial truck than just the price of the truck and its fuel. All these costs can vary too, which means the $1.38 per mile cost of a commercial truck is just an average, and some companies have to pay far more. This is why freight company rates can vary up and down the country, and why it can be extremely difficult for commercial trucking companies to calculate just how much their trucks cost each year, and just how much they should charge customers for delivery.