The Car and Truck Fleet and Leasing Management Magazine

Truck Maintenance Costs Decline 2% to 4% in 2003.

April 2004, by Mike Antich - Also by this author

Light-duty truck maintenance expenses for vehicles with fewer than 48,000 miles declined 4 percent for commercial fleets in the 2003 calendar year compared to 2002, according to a recent industry study conducted by GE Fleet Services. Similarly, maintenance expenses declined 2 percent for light-duty fleet trucks with mileages between 48,000 to 60,000 miles when compared to units in the same mileage band in 2002.

The factors that are keeping a lid on fleet maintenance expenses for passenger cars are doing the same for light-duty trucks. These factors are improved vehicle-build quality, low inflation, price restraint by national account vendors, and longer preventive maintenance (PM) service intervals recommended by manufacturers. Also helping lower PM expenses are longer-lasting wear components and fluids, such as ceramic brake pads, more wear-resistant tires, extended life coolant, synthetic lubricants, platinum-tipped spark plugs, and distributor-less ignition systems.

GE Fleet Services, a fleet management company headquartered in Eden Prairie, Minn., based its survey on actual maintenance expenses incurred by 127,880 light-duty trucks, which included pickups, vans, and SUVs operated by its clients during the 12-month period from Jan. 1 to Dec. 31, 2003.

Tires and Brakes Top Maintenance Expenses
Replacement tires and brake repair were the number one and two maintenance expenses, respectively, for light-duty trucks with fewer than 60,000 miles. In 2003, maintenance expenses for tires and brakes declined when compared year-over-year with those of 2002.

Tire expenses decreased approximately 5 percent in 2003 compared to calendar year 2002.

“There are several reasons why tire costs decline,” said Mark Lange, customer service specialist for GE Fleet Services. “More fleets are looking at value-priced tires, national account pricing has remained stable, and tire wear life has increased.”

Increased tire wear life is substantiated by the latest data released by the National Highway Traffic Safety Administration (NHTSA), which shows that tires are resisting wear better than in 2000. NHTSA, which has rated tires since 1980, reported that 6 percent of tires were rated between a 500 and a 600 on resisting wear, meaning they can last four to six times longer than a basic tire. At least 25 tires had a rating of 700 or higher. In comparison, in 2000, there were hardly any tires with a 600, and no tire earned a 700 rating.

“Today, we have better-made tires,” said Lange. “They are more resistant to wear, meaning fleets are getting more life from a tire.” Similarly, brake repair costs have also decreased for vehicles with fewer than 60,000 miles in 2003 compared to 2002.

“What has caused brake costs to decrease is the increased use of ceramic brake pads. Nowadays, most two- to three-year-old vehicles are equipped with ceramic brake pads, which have a longer wear life,” said Lange. “Instead of replacing brake pads every 30,000-40,000 miles, as has been the case in the past, the average replacement interval has been extended to an average of 40,000-50,000 miles. Over the life of a truck, it may need one less set of brake pads, especially if it is kept in service for 100,000 to 150,000 miles.”

The maintenance study also showed that preventive maintenance expenses for trucks have remained flat for 2003. However, one ongoing trend is that some fleets are extending oil change intervals as a cost-cutting measure. Another increasing trend is that more fleets are using a vehicle’s onboard oil life monitoring system to determine oil change intervals, which extends an oil drain often beyond the traditional 3,000-mile interval.

Truck Maintenance Expenses Beyond 60,000 Miles
In the 2003 calendar year, light-duty truck maintenance expenses marginally increased 1 percent for commercial fleet units with mileages between 60,000 to 84,000 miles. According to GE Fleet Services, almost 35 percent of a vehicle’s lifetime operating costs occurs in the 60,000-80,000-mile range. “Within this mileage range, expenses for brakes and transmissions increase two to six times,” said Eric Strom, manager, maintenance and accidents for GE Fleet Services.

Similarly, after 60,000 miles, transmission expenses start to rise, becoming the third-most expensive maintenance category for light-duty trucks.

“After 60,000 miles, transmission costs dramatically increase because most vehicles are outside the initial warranty period, and the transmission is starting to experience wear and tear,” said Lange.

The survey data also revealed that after 96,000 miles, all maintenance categories recorded a dramatic increase in cost per mile. Maintenance costs, on average, increased 4 percent for light-duty trucks between 84,000 and 96,000 miles.

“However, engine repair costs after 96,000 miles were not as high as engine repair costs in lower mileage windows. We believe that many fleets are deciding not to repair vehicles with more than 96,000 miles that experience catastrophic engine failures. This is often the case for replacement diesel engines, which, for some models, can cost as much as $10,000-$15,000. In these situations, fleets often decide it is not worthwhile to repair the engine,” said Strom. “Another factor in this decision making is whether or not it involves an upfit vehicle. A catastrophic engine failure in an upfit vehicle requires that a fleet manager take into account not only the value of the engine, but also the value of the other equipment installed on the vehicle.”

Overloading Accelerates Wear Rate for Tires and Brakes Although truck maintenance costs declined in 2003, overloading continues to be a key factor in accelerating fleet maintenance expenses and increasing vehicle wear and tear. Overloading persists as a fleet problem because many companies seek to lower acquisition costs by selecting lower-GVW trucks. Since there is often no change in fleet application, the inevitable overloading that results accelerates wear rates for tires and brakes.

“In situations involving vehicle overloading, we also see a lot of powertrain failures due to underspec’ing. These powertrain failures are directly attributable to the overloading of the vehicle,” said Strom. “Overloading may also accelerate suspension wear.”

Besides increased maintenance expenses, overloading also creates an unsafe vehicle and increases liability exposure on the part of the company in the event of an accident. One of the best ways to determine whether vehicles are being overloaded is to assess vehicle usage in the field, said Strom. “The signs of overloading are obvious: a sagging rear-end, irregular tire wear, premature brake wear, and loose unresponsive suspension and steering. When in doubt have the vehicle weighed when fully loaded.”

Future Model Trucks Will Base Replacement Intervals on Usage
Helping to reduce preventive maintenance expenses is the increased use of oil and air filter monitoring sensors.

On some 2004-model GM trucks equipped with Duramax diesel engines, a percentage scale monitor on the air filter cover measures the amount of life remaining in the air filter.

“Instead of changing oil or an air filter at an arbitrary mileage interval, replacement is now based on actual usage,” said Lange. “However, there is a slight risk that by extending preventive maintenance intervals, a vehicle’s brakes and tires will be inspected less often, since the vehicle will be taken less often to a repair facility.”

Although most companies that operate light-duty truck fleets require drivers to perform a daily walk-around inspection, Strom recommends that this type of discipline also be extended to drivers who operate pool vehicles. He says fleet managers should encourage greater responsibility on the part of pool drivers in monitoring tires and brakes by performing a daily walk-around to examine tire wear patterns that may be caused by a worn suspension or an alignment problem. By regularly monitoring and maintaining the recommended inflation pressures in their vehicles’ tires, drivers can help extend tire life. Similarly, drivers need to become sensitive to how a vehicle feels and sounds while driving in order to catch tire and brake problems early on. For instance, drivers should learn to listen for squealing and grinding when braking. These sounds, if heard, should be evaluated by a mechanic as soon as possible since they are warning signs of potential rotor damage.

Another trend that will help decrease PM costs is the shift by most manufacturers to synthetic differential fluid in light-duty trucks. Synthetic differential fluid does not need to be changed for the life of the vehicle. “The only disadvantage is if you develop a gasket or seal leak, the cost to replace the fluid is $20-$30 a pint,” said Strom. “Some differentials hold six pints of fluid.”

Survey Methodology and Terminology
The term incident ratio, used in the charts 1-7, reflects the number of repairs per hundred vehicles. For instance, an incident ratio of 30 percent indicates 30 repairs per 100 vehicles. It is important to note that the figures shown in Charts 1-7 reflect expenses beyond any manufacturer’s warranty coverage. The study tracked cost data and number of incidents from January 2003 through December 2003, regardless of the miles traveled during this 12- month period.

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