The trucking industry saw its combined parts and labor expenses fall 1.4% during the fourth quarter of 2023, according to a benchmarking report from the American Trucking Associations (ATA’s) Technology & Maintenance Council (TMC) and Decisiv.
The results showed a flip from recent trends, as 25 key Vehicle Maintenance Reporting Standards (VMRS) systems dipped in the final quarter of 2023, reversing a 2.1% increase the previous quarter.
The decrease was driven largely by parts costs, which dropped 2.2% in the fourth quarter of 2023 while labor costs fell 0.2%. While quarter-over-quarter parts and labor costs both declined in the last three months of the year, the parts-to-labor ratio held steady at about 1.5 for the past year. On a year-over-year basis, combined parts and labor costs in final quarter of 2023 were 0.2% higher than the same quarter in 2022. However, in the annual comparison, a 2.2% drop in parts prices was offset by a 4.0% rise in labor costs.
Lower parts costs may also reflect a decline in freight tonnage, leading to a decrease in mileage for trucking companies. The For-Hire Truck Tonnage Index from the American Trucking Associations for 2023 showed a 1.7% drop compared to the previous year. That figure, the largest decrease since 2020 and the only year since that tonnage contracted, represents a sizable drop for the trucking industry.
“We are still facing an industry-wide challenge to find technicians, which is increasing labor costs for fleets and service providers. However, quarterly and annual parts cost decreases, driven by a reduction in pricing pressures and the influx of more new trucks, is bringing some welcome relief,” Decisiv President and CEO Dick Hyatt said in a release.
