October 2012 Glostone Newsletter
posted in Newsletter by Brian Gray
Average Truck Cost Per Mile Climbs to $1.71
Each year, the American Transportation Research Institute (ATRI) publishes an Analysis of the Operational Costs of Trucking in an effort to provide more accurate cost data for motor carrier operations. ATRI undertakes this research to document and quantify motor carriers’ key operational costs. The goal of the research is to identify current and accurate operational costs based on data provided directly from motor carriers.
A summary of their findings is presented in the tables below. The tables break down the marginal cost per mile and by cost per hour. The average marginal for 2011 was $1.71, the highest of the four years studied.
After a sharp decline in fuel prices resulted in decreased industry costs between 2008 and 2009, industry costs have steadily risen through 2010 and 2011. The total average industry cost per hour was $68.20 in 2011, the highest “Operational Costs” calculation to date.
Fuel and driver wages (excluding benefits) continue to be the largest cost centers for carriers, together constituting 62 percent of the average operating cost in 2011. Truck/trailer lease or purchase payments were the third largest cost center, constituting 11 percent of costs in 2011, repair and maintenance at 9 percent, driver benefits at 9 percent, and insurance at 4 percent.
Total average costs rose in 2010 and 2011 as compared to 2009, due mostly to a gradual increase in fuel prices. The driver shortage, increasing insurance costs and Compliance, Safety, Accountability (CSA) impacts also put upward pressure on industry costs, as carriers increased wages to recruit and retain qualified drivers. After falling between 2008 and 2009, driver wages increased in 2010 and 2011.
Indicators for 2012 point to a continued increase in industry costs. Fuel prices have risen nearly 10 percent in the first eight months of 2012, which will almost certainly increase multiple cost centers, including tire purchases. The truck driver shortage is expected to become increasingly worse over time, likely translating to higher wages and higher industry costs.
Carriers are in a constant battle between the need to be competitive yet be profitable. Knowing these cost centers allows the carrier to make the best decisions possible.
2013 Licensing and Permit Renewals To Begin
Renewing registrations, licenses, tax accounts, filings, and many specialty permits is an annual headache carriers dread. Most 2013 renewals must take place prior to the end 2012 including:
- Oregon Truck Registrations
- IFTA Licenses
- UCR Filings
- Oregon Tax Weight Identifier Account
- New York Heavy Use Tax Account
- New Mexico Mileage Tax Account
- And many individual Federal and State specialty permits like: Over Dimensional Permits and HazMat Permits
The renewal season floods state agencies with added work. To control the workflow and provide timely service, these agencies open up the renewal process several months prior to the deadline. As the end of the year deadline looms, procrastinators are often faced with long lines and/or long waits to receive their new credentials.
In Oregon, the state has closed 3 state permit offices over the last year which will result in more renewal work for fewer staff. Other states have made similar budget cuts. To guarantee you don’t experience any down time or fines due to expired credentials, we recommend that you renew as soon as possible.
Avoid the long lines and waits altogether by having Glostone process your renewals. We are experts in the renewal process, use the latest technology and have daily agency appointments to get your renewals processed timely and without the headache. Don’t wait until the last minute! Call us today!
Cargo Securement Regulation Terms
Safe cargo securement is required by Federal Motor Carrier Safety Regulations (FMCSR). Part 393.1 of these regulations contains the detail on how freight must be secured. Key to applying these regulations to a specific operation is an understanding of the definition of three basic securement terms frequently used.
The cargo securement regulations use the terms “immobilize,” “contain,” and “restrain” to define how cargo might be secured on or within a vehicle. These three terms really describe different ways of making cargo secure.
“Immobilize” means “not moving” or “incapable of being moved.” Cargo that’s immobile would be the most secure, and this type of cargo doesn’t move at all.
“Restraining” cargo means to limit or hold back any movement. Cargo that is restrained typically has very little free range of movement.
“Containing” cargo may involve packaging, vehicle structures and body panels, other cargo and shipping containers of various types.
As you read through these regulations, knowing these definitions may help clarify specific regulation intentions. Be safe!
10/26: DOT Compliance Training
10/26: DOT Compliance TrainingThe Oregon Trucking Association is offering a full day training on Friday, October 26, 2012, on Department of Transportation (DOT) Compliance and a review of the Federal Motor Carrier Safety Regulations (FMCSR). A substantial list of topic will be covered, and attendees will receive a copy of the FMCSRs, other compliance examples and materials, an electronic copy of the presentation, as well as a full lunch buffet. For more details, click here, and to register, go to the Oregon Trucking Association website.
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Oct, 12
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