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Synthetic Oil

Fleets Transition to Synthetic Motor Oil

For the past decade, more OEMs are recommending the use of more expensive synthetic motor oils, which is increasing the cost of each PM service. But the higher quality motor oil also allows the intervals between these services to lengthen, which is offsetting some of the additional per-transaction costs.

Why the Industry Is Transitioning to Synthetic Motor Oils

There are three key reasons why the transition to synthetic oils is occurring. They are the proliferation of smaller displacement turbocharged engines, escalating CAFE fuel economy requirements, and government regulations to lower tailpipe emissions.

Maintenance Spend Increased 3-5% in 2018

Average repair spend per unit increased 3-5% in calendar-year 2018, primarily due to higher labor rates and part prices. Also, PM costs were up due to the shift to more expensive synthetic oil and higher replacement tire prices.

Upward Pressure on Fleet Costs Threatens to Increase TCO

Recently, I conducted a survey of several hundred fleet managers to identify emerging industry trends. One recurrent theme expressed by fleet managers was the concern that fleet costs are starting to experience upward pricing pressures. Here's what they told me.

Fleet Preventive Maintenance Costs Increase 3%

Extended oil-drain intervals have helped to offset increases in the cost of motor oil because of the expanded use of synthetic oils and cartridge oil filters. Higher labor rates in 2017 exerted upward pressure on preventive maintenance costs.

Higher Labor, Parts Drive Up Fleet Maintenance Costs

Although repair incidents were flat, other fleet-related maintenance expenses were up in calendar-year 2017, primarily in labor rates and parts prices. PM costs were up around 3%, while replacement tire costs increased 5-10%.