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Owner Operator Class 8 Operational Costs

buckwilliams

(Last Updated On: January 14, 2023)

Last Updated on January 14, 2023 by buckwilliams

Owner Operator Tutorial

Owner Operator Class 8 Operational Costs

How Fuel Costs Vary With Operations – Using a Typical Class 8 Over-the-Road Tractor-Trailer As An Example

Think about all of the things you can do as you roll down the road!!!

BACKGROUND

As a successful truck operator, it is important to understand the effect of your operations on profitability. We wanted to show an example of typical equipment in an operation and go through some of the variables.

We based this example on an aerodynamic 18-wheel truck with a smooth side van trailer, operating at 60 miles per hour (MPH) with 80,000 pounds gross vehicle weight.

This results in a truck getting about 6 miles per gallon (MPG).

We then varied each parameter to show the relative effect (MPG and cost) from this baseline.

For comparative purposes, we showed first the effect of what you do in every day operations. We followed that with what happens when outside parameters (wind, etc.) affect operations. Basic specing issues are addressed under “Industry Services – Equipment Specifications.

Note: This information was compiled from various industry sources and actual operations. It was averaged for discussion and planning purposes. It may vary slightly when compared to individual representations from operators, manufacturers and suppliers. Annual costs are calculated for operations averaging 2,500 miles / week.

YOUR OPERATION

– Speed has the largest effect on your operational cost. Every 5 MPH costs about 0.5 MPG or $0.02 per mile in fuel. If you are running 75 MPH and slow to 65 MPH, that is 1 MPG or $0.04 per mile or over $6,000 per year savings. Note: This is based on a fuel cost of $1.20 per gallon. As prices go up, this cost (and savings) multiplies!!!

– Speed also has wear costs. That same 10 MPH saves about 10% in tire life (tires running cooler); 10-20% in engine life (depending on engine size), 20% in brake life (not slowing for others) and stress / wear on you.

– Idle time also has a notable effect on costs. With an average idle time of 10 hours per day (heater, air conditioning, TV / VCR…), this costs about 0.6 MPG or $0.02 per mile or about $2,500 per year. Minimizing idle can help.

– Running your engine fan all of the time costs from 10 to 40 HP. This can cost up to 0.3 MPG or about $0.01 per mile or $1,200 per year. (Yes, some still do it)

– Alignment doesn’t affect fuel mileage much (0.1 MPG), but it reduces tire life up to 50%.

– Tire pressure also doesn’t affect fuel mileage much (0.1 MPG), but it also can reduce tire life up to 30%.

OUTSIDE FACTORS

– Wind seems always to be going a different direction than you are. It can cost you up to 1.5 MPG, over $0.05 per mile or over $7,000 per year. The rule is to just slow down.

– Extreme temperatures (hot or cold) can cost up to 1.0 MPG, over $0.03 per mile or over $4,000 per year. The rule again is to just slow down.

– Running mountains versus the flats can cost up to 1.0 MPG, over $0.03 per mile or over $4,000 per year. The key here is to take it easy both up and down the hills.

– If roads are rough or soft, your mileage can be affected up to 0.6 MPG, about $0.02 per mile or about $2,500 per year. Again, slowing down is the key thing to do.

– Blended fuel can cost up to 0.5 MPG, over $0.01 per mile or about $2,000 per year. That is just one reason why we see mileage drop in the winter.

– As you find in the Surcharge Overview, the rule of thumb for both shopping fuel prices and assessing surcharge is “Nickel = Penny.” In other words, a nickel ($0.05) per gallon diesel fuel price change equals a penny ($0.01) per mile change in your cost per mile. That means that a swing of $0.40 per gallon fuel cost was about $0.08 per mile or over $10,000 per year.

– If you are running light loads or a significant amount of deadhead, you should experience a notable increase in fuel mileage. The same truck noted in the beginning of this example with a gross vehicle weight of 40,000 pounds (almost empty) should see an increase of about 1.5 MPG or over $0.05 per mile in fuel savings.

Note: You can use this to adjust to your actual operation.

Some helpful tips again

Slowing down a little saves a lot — 5 MPH = $0.02 per mile
Minimize your idling — 10 hours per day = $0.02 per mile
Keep an eye on your alignment and tire pressure (tire life)
Shop for your best fuel value — $0.05 per gallon = $0.01 per mile
Spec the right equipment for your operation
Get help from industry suppliers

Printed with permission
Transportation Business Associates
Business Services for the Transportation Industry
P. O. Box 17531
Denver, Colorado 80217-0531

Owner Operator Tutorial Menu

Let’s look at your Revenue: Click here
Let’s look at your Fixed Expenses
Let’s look at your Variable Expenses
Let’s look at your Class 8 Operational Costs
Let’s look at your Net Profitability
Let’s look at how a fuel surcharge matters to you
What is the Outlook for the Trucking Industry?
Should I Get My Own Operating Authority?
Trucker incorporation: Should I Incorporate?
What do I need to know about my Credit History
Why Do New truck owners FAIL? Click Here
Advice every Truck Driver and Owner Operator should know Click here
 

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Important Info

  • Assessing Fuel Surcharge for Owner Operators
  • Independent Contractor vs Own Authority as an O/O
  • Fixed Expenses as an Owner Operator
  • Market Overview for Tractor Trailer Owner Operators
  • Owner Operator Class 8 Operational Costs
  • Owner Operator Net Profitability
  • Should an Owner Operator Incorporate
  • Tractor Trailer Credit Primer – For all Truck Drivers
  • Variable Expenses for Owner Operators
  • Why New Owner Operators Fail in the Trucking Business
  • Your Revenue as an Owner Operator
  • Free Advice To all Truckers & Owner Operators
  • Basic 2290 Information for all Owner Operators

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