By Mike Antich 

For the first time ever, the price of diesel in many regions of the country exceeds $4 a gallon. Since Jan. 1, diesel prices have risen more than 19 percent. The American Trucking Associations (ATA) predicts that truck fleets will spend more than $135 billion on fuel in 2008. This compares to $112 billion in 2007. If the ATA prediction comes true (and there is no reason to believe it won’t), the amount of money truck fleets will spend on fuel in 2008 is the equivalent to the entire gross domestic product of Ireland! I don’t know about you, but I find this incredible.

Overall operating costs for Class 3-6 trucks increased in calendar year 2007 compared to 2006. Operating costs (which include fuel, repair, PM, and tire expenses) promise to increase again in 2008 above the 2007 level. The key reason for last year’s increase was a more than 3-cents-per-mile (CPM) jump in fuel costs and a 4- to 7-percent increase in replacement tire costs. All major tire manufacturers increased base tire pricing for fleets in 2007 and are continuing to do so in 2008 to counter rising material costs.

In addition, the mandate to use ultra-low sulfur diesel (ULSD) has increased the retail pump price of diesel. The increased cost of manufacturing ULSD has resulted in an average of $0.06 per gallon increase over regular diesel. One silver lining is the anticipated 3-percent decrease in mpg for the new 2007-compliant engines did not occur. According to most truck fleets, the new engines have not experienced degradation in fuel mileage.

There has been an indirect impact due to high fuel costs in ancillary services such as mobile fueling and towing. Many mobile and towing vendors added surcharges to cover higher fuel costs.

Fleets are actively looking for ways to minimize fuel spend. Increasingly, they are looking beyond pump prices for fuel savings. One way to reduce fuel expenditures is by modifying truck specs to increase miles-per-gallon fuel economy. For example, fleets in certain industries are making changes to their truck, upfit, and tractor specifications to help improve fuel economy.

PHH Arval recently conducted a study that showed fuel costs can be reduced by slightly over-spec’ing a truck.

Fuel economy was improved by as much as 0.3 mpg by slightly over-spec’ing an engine to run more consistently in the “sweet spot,” choosing a gear ratio low enough to suit a fleet’s application and location and enabling the correct fuel-efficient, engine-specific parameters.

Likewise, GE Capital Solutions Fleet Services cites four areas to consider when spec’ing trucks to improve fuel economy:

1. Truck transmission and drive axle ratio: By gearing a truck so the engine is running at a slower RPM at a given speed, less fuel is burned. This must be balanced with meeting “startability and gradeability” requirements.

2. Engine horsepower and torque: When taking advantage of the first point (gear fast, run slow), it may be necessary to in-crease engine horsepower and torque to meet power demands at lower RPMs.

3. Multi-torque or multi-horsepower engines: These engines run at a lower rating when the driver is operating the throttle. When the cruise control is engaged, the engine rating is increased to its higher rating. This encourages a driver to use cruise control, which can save fuel over a driver-controlled throttle.

4. Drivers’ influence on fuel economy: Driver training, in-truck displays, and telematics are used to modify driver behaviors.

Other specifications to decrease fuel expenditures include specifying aerodynamic mirrors, moving air filters under the hood, dropping fender-mounted mirrors, and installing in-cab electronics for drivers to monitor fuel economy performance while driving.

Altering tire specifications is also being investigated, such as using low rolling resistance tires. However, the best way to reduce tire and fuel costs is to establish a process for drivers to regularly monitor tire inflation. To control replacement tire costs, eliminate driver behaviors that decrease tread life of the tires, such as speeding, excessive braking, driving over curbs, and load distribution. Another cost reduction strategy adopted by some fleets is the switch to retread tires and/or leasing tires.

Fleet managers are looking for relief in operating expenses by identifying ways to counteract higher fuel costs. In addition to modifying truck specs, fleets are also focusing on training drivers to drive for improved fuel economy. For instance, a controllable fuel expenditure is the elimination of unnecessary idling. States, such as California and North Carolina, are assisting in this effort by mandating idling limit devices. A growing number of fleets are also researching, piloting, and implementing telematics solutions to optimize routes and reduce idling.

In the final analysis, reducing fuel costs involves the adoption of a multi-prong strategy. One important component in a multi-prong strategy is modifying truck specifications. This practice has been verified to yield measurable fuel reductions.

Let me know what you think.

mike.antich@bobit.com