Parts and Labor Costs Continue Downward Trend in the First Quarter of 2024

Jul 03, 2024

Benchmarking Report from TMC and Decisiv shows 2nd quarter of improvement since mid-2023

Washington - Today, American Trucking Associations' Technology & Maintenance Council and Decisiv Inc. said that combined parts and labor expenses fell 1.7% during the first quarter of 2024, according to data released in the latest Decisiv/TMC North American Service Event Benchmark Report.

"Lower parts and labor costs are welcome news to fleets, who have been weathering substantial increases for much of the last several years," said TMC Executive Director Robert Braswell. "This important parts and labor cost analysis report is an excellent tool to help Council members compare how their operations are performing relative to industry trends and plan accordingly."

The report shows these costs across 25 key VMRS systems continued a downward trend seen in the previous quarter when those costs fell 1.4%. Reversing the upward trend seen earlier last year quarter-over-quarter combined parts and labor costs were up in only seven of the 25 VMRS systems, about 50% fewer than the 13 systems in the previous quarter.

Reflecting the data in the report is that the cost of parts rose in seven systems, and labor costs increased in 12 systems, but overall cost decreases were evident for both parts and labor. In the first quarter, parts costs were down 2.4%, the second quarterly decline in a row, and labor costs fell 0.8% after two consecutive quarterly increases.

On a year-over-year basis, combined costs also dropped, down 2.3% from the same quarter last year. However, labor costs from year to year rose 0.9%, although the increase was significantly smaller than the 4.0% rise seen in the previous quarterly report.

"While more new trucks and greater parts availability are helping commercial asset service operations realize an across-the-board drop in costs, the ongoing shortage of new technicians entering the workforce continues to drive up labor costs," said Decisiv President and CEO Dick Hyatt. "The recent findings are certainly positive. The ongoing efforts by commercial asset service operations to streamline management and execution of maintenance and repair activities are clearly playing a role in keeping costs down."

A continuing influx of new trucks and the resolution of supply chain issues are helping commercial asset service operations realize a widespread drop in parts costs. At the same time, however, the ongoing shortage of new technicians entering the workforce continues to drive up labor costs by requiring higher spending to attract and retain qualified help from a shrinking workforce.

The data that Decisiv collects and analyzes for the Decisiv/TMC North American Service Event Benchmark Reports on 25 Vehicle Maintenance Reporting Standard system level codes accounts for more than 97% of total parts and labor costs for more than seven million assets and over 300,000 monthly maintenance and repair events at more than 5,000 service 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 https://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 X, 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 four 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 enable 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.