Fuel surpasses labor expense
for many commercial carriers
Mar 27, 2008 10:42 AM
For a number of motor carriers, fuel has now surpassed labor as their largest expense, according to the American Trucking Associations (ATA).
The rising cost of fuel has the potential to create a ripple effect through the economy because, if prices continue to rise, eventually consumers will likely see higher costs for whatever they are purchasing that is being delivered by truck, ATA said.
This is significant because more than 80 percent of communities in the United States get their goods solely by truck. Commercial trucks consume 53.9 billion gallons of fuel each year. About 39 billion gallons, or 73 percent, is diesel. The remaining 27 percent is gasoline.
A one-penny increase in the price of diesel annualized over an entire year costs the trucking industry an additional $391 million a year.
ATA pointed out that there is strong correlation between crude oil prices and diesel prices. The cost of crude accounts for more than 60 percent of diesel’s pump price.
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