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An Analysis of the Operational Costs of Trucking: 2016 Update

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An Analysis of the Operational Costs of Trucking: 2016 Update An Analysis of the Operational Costs of Trucking: 2016 Update September 2016 An Analysis of the Operational Costs of Trucking: 2016 Update September 2016 W. Ford Torrey, IV Research Associate American Transportation Research Institute Atlanta, GA Dan Murray Vice President, Research American Transportation Research Institute Minneapolis, MN 950 N. Glebe Road, Suite 210 Arlington, Virginia 22203 www.atri-online.org ATRI BOARD OF DIRECTORS Ms. Judy McReynolds Mr. Rich McArdle Chairman of the ATRI Board President Chairman, President & CEO UPS Freight ArcBest Corporation Richmond, VA Fort Smith, AR Mr. Jeffrey J. McCaig Mr. Michael S. Card President & CEO President Trimac Transportation, Inc. Combined Transport, Inc. Houston, TX Central Point, OR Mr. Gregory L. Owen Mr. Michael L. Ducker Head Coach & CEO President & CEO Ability/ Tri-Modal Transportation FedEx Freight Services Memphis, TN Carson, CA Mr. Rich Freeland Ms. Annette Sandberg President & COO President & CEO Cummins Inc. Transsafe Consulting, LLC Columbus, IN Davenport, WA Mr. Hugh H. Fugleberg Mr. Steve Williams President & COO Chairman & CEO Great West Casualty Company Maverick USA, Inc. South Sioux City, NE Little Rock, AR Mr. Dave Huneryager Ms. Rebecca M. Brewster President & CEO President & COO Tennessee Trucking Association American Transportation Research Nashville, TN Institute Atlanta, GA Mr. Derek Leathers President & CEO Mr. Chris Spear Werner Enterprises President & CEO Omaha, NE American Trucking Associations Arlington, VA Mr. Chris Lofgren President & CEO Schneider National, Inc. Green Bay, WI ATRI RESEARCH ADVISORY COMMITTEE Mr. Steve L. Niswander Mr. Chad England Mr. Jonathan R. Peters, PhD RAC Chairman Chief Executive Officer Professor of Finance, Department VP, Safety Policy & Regulatory C.R. England of Business Relations College of Staten Island – The City Groendyke Transport, Inc. Mr. Paul J. Enos University of New York Chief Executive Officer Mr. Doug Bennett Nevada Trucking Association Ms. Karen Rasmussen Director, Operations & Business President & CEO Development Ms. Sherri Garner Brumbaugh HELP Inc. U.S. AutoLogistics, L.L.C. President & CEO Garner Transportation Group Ms. Barbara Robinson Ms. Amy Boerger Director Vice President – North American Dr. David W. Guess American Truck Dealers (ATD) Engine Business Executive Vice President, Safety & McLean, VA Cummins Inc. Regulatory Affairs Usher Transport, Inc. Mr. Wellington F. Roemer, III Mr. Andrew Boyle President & CEO Executive VP & CFO Mr. Sanford Hodes Wellington F. Roemer Insurance, Boyle Transportation Senior Vice President & Deputy Inc. General Counsel Mr. Randy Boyles Ryder System, Inc. Mr. Steve Rogers Senior Vice President, Tailored Solutions Mr. Shannon Lively Vice President, Truckload PeopleNet Vice President – Planning and Operations Engineering J.B. Hunt Transport, Inc. Ms. Cheryl Bynum ABF Freight System, Inc. Manager, SmartWay Transport Mr. Brett A. Sant Partnership Ms. Michelle D. Livingstone VP, Safety and Risk Management U.S. Environmental Protection Vice President – Transportation Knight Transportation, Inc. Agency The Home Depot Ms. Andrea Sequin Mr. Louis Campion Mr. Vladimir Livshits, Ph.D. Director, Regulatory Services President System Analysis Program Manager Schneider National, Inc. Maryland Motor Truck Association, Maricopa Association of Inc. Governments Mr. Brandon Shafer Director of Health and Safety Mr. Michael Conyngham Mr. Chris McLoughlin UPS Freight Director of Research Cargo Risk Manager International Brotherhood of C.H. Robinson Mr. Keith Tuttle Teamsters Founder Mr. Scott Mugno Motor Carrier Service Inc. Mr. Bob Costello Vice President, Safety & Chief Economist & Senior VP Maintenance Mr. Ronald Uriah American Trucking Associations FedEx Ground Vice President, Safety Pitt-Ohio, LLC Mr. Tom Cuthbertson Ms. Brenda Neville Vice President, Regulatory President Mr. Tom Weakley Compliance Iowa Motor Truck Association Director of Operations Omnitracs LLC Owner-Operator Independent Mr. Dean Newell Drivers Association Foundation Mr. Dennis Dellinger Vice President, Safety President Maverick USA, Inc. Mr. Rusty Weiss Cargo Transporters Director, External Research Major David L. Palmer DriveCam-Lytx Mr. Duke Drinkard Major, Texas Hwy Patrol Division Energy Manager Texas Dept. of Public Safety Mr. Geoffrey Wood Southeastern Freight Lines VP, Operations & Safety Mr. Chip Duden Canadian Trucking Alliance Vice President, Strategic Business Analytics Werner Enterprises TABLE OF CONTENTS FIGURES AND TABLES ................................................................................................. 2 LIST OF ACRONYMS ..................................................................................................... 3 INTRODUCTION ............................................................................................................. 4 RESEARCH OBJECTIVE ............................................................................................... 5 METHODOLOGY ............................................................................................................ 6 RESPONDENT DEMOGRAPHIC ANALYSIS ................................................................. 8 Type of Operation ........................................................................................................ 9 COST CENTERS .......................................................................................................... 14 Fuel ............................................................................................................................ 14 Equipment .................................................................................................................. 17 Driver Pay .................................................................................................................. 17 FINDINGS ..................................................................................................................... 18 Average Marginal Costs ............................................................................................. 18 Line Item Cost Centers .............................................................................................. 21 Fuel Costs .............................................................................................................. 21 Equipment Lease or Purchase Payments ............................................................... 22 Repair and Maintenance ......................................................................................... 23 Truck Insurance Premiums ..................................................................................... 25 Permits and Special Licenses ................................................................................. 26 Tires ........................................................................................................................ 26 Tolls ........................................................................................................................ 27 Driver Wages and Benefits ..................................................................................... 27 Cost Trends ............................................................................................................... 28 Cost by Region .......................................................................................................... 29 CONCLUSION .............................................................................................................. 30 APPENDIX A ................................................................................................................. 31 An Analysis of the Operational Costs of Trucking: 1 2016 Update FIGURES AND TABLES Figure 1: New Survey Questions ..................................................................................... 6 Table 1: For-Hire Industry Sector Breakout ..................................................................... 7 Figure 2: Respondent Fleet Size ..................................................................................... 8 Table 2: Respondent Fleet Size Statistics ....................................................................... 8 Table 3: Respondent Revenue Statistics ........................................................................ 9 Table 4: Survey Respondent Trip Types ......................................................................... 9 Table 5: Survey Respondent Truck VMT and National Truck Registrations by Region 10 Table 6: Survey Respondent Truck/Trailer Type, Average Truck Age, and Average Miles Driven per Year per Truck .................................................................................... 11 Table 7: Survey Respondent Equipment Trade Cycle................................................... 11 Table 8: Survey Respondent Speed Limiter Usage ...................................................... 12 Table 9: Survey Respondent Reported Fuel Economy Compared to Typical Operating Weight and Average Operating Speed .......................................................................... 13 Figure 3: Average U.S. On-Highway Diesel Prices, 2008 – 2015 ................................. 15 Figure 4: Average U.S. On-Highway Diesel Prices, 2015 ............................................. 16 Table 10: Average Marginal Costs per Mile, 2008-2015 ............................................... 19 Table 11: Average Marginal Costs per Hour, 2008-2015 .............................................. 19 Table 12: Share of Total Average Marginal Cost,
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