The forecast of the cost of maintenance and unscheduled repair is anticipated to go up in CY-2021.
The trend of increased PM costs per service will continue as more and more vehicles requiring conventional oil are taken out of service and replaced with models that require synthetics.
The largest fleet operating expense is fuel, which traditionally represents approximately 60% of all operating costs. However, the decreased miles driven by fleets during the pandemic was the No. 1 factor contributing to keeping fuel costs flat in 2020.
The ultimate outcome of the pandemic and the strength of the economic recovery are driving many predictions on future pricing.
More stringent enforcement of OEM-recommended services to qualify for warranty coverage continues. Cash flow issues caused by the pandemic have caused some OEMs to be more tight-fisted with warranty recovery dollars.
A perennial factor exerting upward pressure on replacement tire costs is the adoption of larger diameter tires and unique tire sizes. The increase in OEM automobile wheel diameters has driven up the price of fleet replacement tires, primarily because the larger the tire, the greater the manufacturing expense.
Reduced tire demand and a decrease in overall miles driven have caused tire manufacturing volume to decline in 2020, creating a downstream ripple effect softening commodity prices for natural rubber, but this may change in 2021.
The COVID-19 pandemic divided the fleet market into essential and non-essential businesses, causing hundreds of thousands of company vehicles to sit idle from mid-March to mid-May. The economic shutdown caused miles-driven to plummet.
One trend that is gaining momentum among commercial fleets during the pandemic is the use of mobile maintenance vendors. There has been a substantial uptick in fleet requests for mobile maintenance solutions as fleet managers look to minimize downtime and the administrative burden of taking their vehicle to a repair shop and having the driver wait.
Operating cost trends analyzed in this video includes current fuel pricing trends and forecast for 2021 calendar year; maintenance (includes preventive and unscheduled maintenance) trends; part shortages caused by component backorders; replacement tire pricing trends.