Lower Tire and PM Lower Tire and PM Maintenance CPM Flat in 2004

Maintenance expenses for fleet cars were flat during the 2004 calendar year when compared to 2003. The main factors contributing to the stability of fleet maintenance costs in 2004 were longer oil drain intervals, extended tire tread wear, and increased life from ceramic brake pads. All other maintenance categories tracked in the survey were flat with a 1-percent or less change in cents-per-mile (CPM) expense compared to the prior year’s survey. These were among the key findings of the 10th annual fleet passenger car maintenance study conducted by GE Commercial Finance Fleet Services, a fleet management company headquartered in Eden Prairie, Minn. Their study was based on a survey of actual maintenance expenses incurred by 32,614 passenger cars during the 12-month period from Jan. 1 to Dec. 31, 2004.

Lower PM Costs
“A key reason for the decline in preventive maintenance (PM) expense in 2004 was the proliferation of onboard vehicle oil life monitoring systems,” said Tim Derochie, product manager maintenance and safety services for GE Commercial Finance Fleet Services. “There is a growing acceptance among fleets to go to a longer oil change interval period when using an oil life monitoring system. The extended oil change interval is becoming an industry norm,” said Derochie.

Longer Tire Tread Life Tire replacement expenses declined in 2004 due to ongoing improvements in tire quality that is resulting in longer wear life. “The overall quality of tires has improved dramatically in the past decade,” said Mark Lange, customer service specialist for GE Commercial Finance Fleet Services. “Tire life has been extended by 10 percent in the past five to 10 years, which has driven down overall CPM for tires. In 2004, tires represented the biggest decline in maintenance expenses.”

Decline in Brake Expenses
Brake expenses also declined in 2004, primarily due to the increased use of longer-lasting ceramic brake pads. “Depending on the replacement cycle parameters, it’s possible a vehicle could go through its lifecycle without having to replace brake pads,” said Lange.

Four Other Maintenance Trends

Increased HVAC Expense: There was a slight increase in the number of incidents and costs dealing with heat-ing, ventilation, and air conditioning (HVAC) systems. “This was because most new vehicles are equipped with cabin filters,” said Dale Nicholson, manager of maintenance services for GE Commercial Finance Fleet Services. “This was an expense that didn’t exist 10 years ago. It costs approximately $50 to replace a cabin filter.”

Lifetime Fuel Filters

“Some manufacturers’ vehicles are equipped with lifetime fuel filters,” said Lange. “In the past, fuel filters needed to be changed every 30,000-50,000 miles as a preventive maintenance. Now several models have a lifetime fuel filter/fuel system regulator in the fuel tank. At $75 per service, by eliminating the need for fuel filter changes, it has generated substantial savings.”

Stainless Steel Exhaust Systems
“The maintenance cost for exhaust systems has gone down because they are lasting longer,” said Lange. Vehicles are now built with a stainless steel exhaust system, which has increased longevity, especially in the Snow Belt areas of the country.”

Rising Labor Rates
“We are continuing to see labor rates go up,” said Lange. “Today, the average national account labor rate is $60 to $70 per hour, while the average labor rate at a dealership is between $90 to $100. Some high-cost metro areas, such as the San Francisco Bay area, have labor rates averaging $125-$150 per hour. See Charts below. Charts 1-7