Combined parts and labor expenses fell 1.7% during the first quarter of 2024, according to data released in the latest North American Service Event benchmark report from Decisiv and American Trucking Association’s Technology & Maintenance Council.
“Lower parts and labor costs are welcome news to fleets, who have been weathering substantial increases for much of the last several years,” Robert Braswell, TMC executive director, said in a news release. “This important parts-and-labor cost analysis report is an excellent tool to help council members compare how their operations are performing relative to industry trends and plan accordingly.”
The report shows these costs across 25 key VMRS systems continued a downward trend seen in the previous quarter when those costs fell 1.4%. Reversing the upward trend seen earlier last year, quarter-over-quarter combined parts and labor costs were up in only seven of the 25 VMRS systems, about 50% fewer than the 13 systems in the previous quarter.
Reflecting the data in the report is that the cost of parts rose in seven systems, and labor costs increased in 12 systems, but overall cost decreases were evident for both parts and labor. In the first quarter, parts costs were down 2.4%, the second consecutive quarterly decline, and labor costs fell 0.8% after two straight quarterly increases.
On a year-over-year basis, combined costs also dropped, down 2.3% from the same quarter last year. However, labor costs from year to year rose 0.9%, although the increase was significantly smaller than the 4% rise seen in the previous quarterly report.
“While more new trucks and greater parts availability are helping commercial asset service operations realize an across-the-board drop in costs, the ongoing shortage of new technicians entering the workforce continues to drive up labor costs,” said Dick Hyatt, Decisiv president and CEO. “The recent findings are certainly positive. The ongoing efforts by commercial asset service operations to streamline management and execution of maintenance and repair activities are clearly playing a role in keeping costs down.”
A continuing influx of new trucks and the resolution of supply chain issues are helping commercial asset service operations realize a widespread drop in parts costs, ATA said. At the same time, however, the ongoing shortage of new technicians entering the workforce continues to drive up labor costs by requiring higher spending to attract and retain qualified help from a shrinking workforce.
The data that Decisiv collects and analyzes for the Decisiv/TMC North American Service Event Benchmark Reports on 25 Vehicle Maintenance Reporting Standard system level codes accounts for more than 97% of total parts and labor costs for more than 7 million assets and over 300,000 monthly maintenance and repair events at more than 5,000 service locations.