W elcome to the FleetWatch truck operating benchmarks for August 2017. The schedule covers a variety of typical

primary and secondary distribution trucking operations published since February 2004.

The objective is to provide operators and shippers (consignors) with a reliable independent guide to trucking costs incurred in the transportation of raw materials, semi-finished and finished products.

A thorough understanding of the assumptions and how they are applied in developing the benchmarks is necessary if the various benchmarks are to be informative, beneficial and helpful. While FleetWatch takes no responsibility for the accuracy of the estimates, considerable time and effort has been expended to ensure the various components are realistic and representative of the hypothetical transport tasks contained in the schedule. Updated estimates are published quarterly. However, the schedule is continuously monitored and updated monthly.

ASSUMPTIONSWhile many transport tasks are similar

few are ever identical. With this in mind it is important to bear in mind the aim and application of the various components that apply to a transport operation. These include:

VEHICLE TYPEBriefly describes the vehicle

configuration contemplated for a specific task (eg – 4x2 a rigid freight carrier with

volume van body for medium distance delivery of typical FMCG products).

PAYLOAD (TONS)The assumptions are based on typical

optimal legal mass payload that can be achieved on any number of vehicles, bodies and trailers freely available on the local market. In practice the actual payload will depend on the vehicle manufacturers’ specification and the road-ready unladen mass.

DECK LENGTH (METRES)The assumptions are based on typical

optimum mass distribution for the assumed vehicle configuration and the contemplated task. In practice there are many wheelbase and axle capacity options to suit specific requirements.

PALLETSThe assumption contemplates

1000x12000 mm 4-way entry pallets. The mass of pallets is not taken into account.

VOLUMECubic assumptions are based on

length, width and height of typical bodies applicable to the various operations. In practice this varies with measurements of specific bodies.

ANNUAL KILOMETRESAnnual kilometres are based on typical

operations. Annual kilometres of vehicles engaged in short and medium collect and delivery tasks vary considerably. Space limitations prohibit the inclusion of a wider variety of such tasks.

WORKING DAYSA five-day week is assumed for the

vehicles most likely to be involved in delivery operations. Larger rigs often work longer hours to meet the demands of long distance haulage. The imminent implementation of driving hours must be

taken into account to ensure compliance with the regulations.

SHIFTSShifts indicate the daily working hours

of fridge units and tipper trucks.

ECONOMIC LIFEIs based on 800 000 km as a first

economic life for the driveline. This is in line with vehicle manufacturers’ maintenance contracts for standard operations over 48 or 60 month periods. The estimates do not assume that vehicles may be replaced before, on or after the suggested date. Achieving the economic life of the major components is an important element in producing cost-effective transport.

CAPITAL COST All estimates are based on the cost

of new vehicles and equipment. The indicated initial cost of vehicles, trailers, bodies and auxiliary equipment (such as fridge units) is based on the current list price of such items. The prices quoted by leading suppliers are averaged. VAT is excluded.

STANDING COST/FIXED COSTSStanding costs are incurred whether the vehicle moves or just stands. When vehicles do not cover significant kilometres or work for long hours, standing costs will be high and difficult to recover. Our assumptions are:

DEPRECIATIONAll depreciation is straight line.• Vehicles – 20% a year over five years. No

allowance for residual value• Auxiliaries – 25% a year straight line. No

residual value• Trailers – 10% a year. No residual value

Tyre values are not deducted from the initial price of vehicles and trailers prior to depreciation.

Compiled by Max Braun Exclusive

truck operating benchmarksMarket related owning & operating estimates for a variety of popular trucking operations

2017 / VOL 52 FLEETWATCH 53

56

www.iveco.co.za

FLEETWATCH MARKET RELATED TRUCK OPERATING BENCHMARKS (Per Annum) 02-August-17

OPERATION Short Med Long Med Long Truck Truck & 12.5 m 8.4 m 13.5 m 13.5m End 14,7 Taut-liner Flat deck OPERATIONHaul Haul Haul Long Haul Med Trailer Dual-axle Insulated Dual-axle Tridem-axle Tridem Tip Tridem Reefer Interlink InterlinkMetro Haul Long Haul Semi Med Haul Semi Semi Semi Semi

ASSUMPTIONS ASSUMPTIONSVehicle Type Panel Van Insulated Insulated Volume Flat 6x4 Rigid 6x4 Rigid 4-axle 6x2 5-axle 5-axle 6-axle 6-axle 7-axle 7-axle Vehicle Type

Van Van Van Van Deck & Trailer Artic Rigid Artic Artic Artic Artic Artic ArticAverage Payload (tons) 3 3,5 5,5 8 8 14 26 21 13,5 26 25 30 30 34 36 Average Payload (tons)Deck Length ( metres) 4 4,2 6,5 7,5 7,5 7,5 15 12,5 8,4 13,5 13,5 14,7 18 18 Deck Length ( metres)Pallets 4 6 8 8 8 24 20 16 24 24 30 36 36 PalletsCubes 16 20 37 37 30,5 92 Cubes Annual KM 50000 30000 60000 45000 85000 65000 100000 120000 135000 160000 160000 75000 180000 180000 200000 Annual KMWorking Days 260 260 260 260 260 260 260 260 260 260 260 286 286 286 286 Working DaysShift Hours (fridge) 11 11 10 Shift Hours (fridge)Useful Life (KM) 300000 350000 350000 450000 600000 800000 800000 600000 800000 800000 800000 600000 800000 800000 800000 Useful Life (KM)Useful Life (Years) 6 8 6 8 8 8 8 5 6 5 5 8 5 5 4 Economic Life (Years)CAPITAL COST CAPITAL COSTPrime Mover 373118 395829 621863 621863 621863 1172655 1172655 1070685 1359600 1379170 1449210 1500000 1485260 1616843 1616843 Prime MoverBody 137500 145200 110000 99000 137500 137500 302500 BodyAuxiliary Equipment 269640 315000 315000 472500 auxiliary Equipment1st Trailer 319000 286000 286000 319000 575000 700000 220000 209000 1st Trailer2nd Trailer 396000 374000 2nd TrailerOther OtherTotal Capital Cost 373118 802969 1082063 731863 720863 1310155 1629155 1356685 1977100 1665170 1768210 2075000 2657760 2232843 2199843 Total Capital CostSTANDING COST STANDING COSTPrime Mover Depreciation 74624 79166 124373 124373 124373 234531 234531 214137 271920 275834 289842 300000 297052 323369 323369 Prime Mover DepreciationBody Depreciation 27500 21780 16500 14850 20625 45375 Body DepreciationAuxiliary Depreciation 50558 59063 59063 88594 Auxiliary DepreciationTrailer Depreciation 23925 21450 23925 53906 52500 46200 43725 Trailer DepreciationTotal Depreciation 74624 157223 205215 140873 139223 255156 258456 214137 376358 297284 313767 353906 438146 369569 367094 Total DepreciationCost of Capital 24506 52739 71070 48069 47346 86051 107003 89107 129856 109368 116136 136286 174562 146653 148181 Cost of CapitalPrime Mover Licence 1488 2112 4890 4890 4890 16227 16227 9480 11532 11532 14433 17763 17763 17763 17763 Prime Mover LicenceTrailer Licence 4890 4944 5700 5700 16404 16404 12432 11364 Trailer LicenceTotal Licence Fee 1488 2635 4890 4890 4890 16227 21117 14424 11532 17232 20133 34167 34167 30195 29127 Total Licence FeeTotal Insurance 27984 60223 81155 54890 54065 98262 122187 101751 148283 124888 132616 155625 199332 167463 164988 Total InsuranceDriver Wages 115200 126720 133142 144000 144000 198720 198720 216000 216000 263520 276480 282240 313920 313920 313920 Driver WagesAssistant Wages 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 Assistant WagesTotal Wages 213000 224520 230942 241800 241800 296520 296520 313800 313800 361320 374280 282240 411720 411720 411720 Total WagesTOTAL STANDING COST 341602 497340 593272 490521 487323 752216 805283 733219 979828 910092 956932 962224 1257926 1125600 1121110 TOTAL STANDINGAs a % of Total Cost 58,48% 61,99% 54,09% 63,69% 41,64% 58,17% 47,25% 42,95% 44,83% 38,76% 41,71% 50,11% 38,19% 36,31% 34,09% As a % of Total costVARIABLE COST VARIABLE COSTPrime Mover Fuel 165735 130038 270480 158484 299359 305229 512273 575489 633938 901600 819636 483000 1014300 1193294 1288000 Prime Mover FuelAuxiliary Fuel 70438 48841 72313 84525 Auxiliary FuelTotal Fuel 165735 200476 319321 158484 299359 305229 512273 575489 706250 901600 819636 483000 1098825 1193294 1288000 Total FuelTop-up Oil 8287 10024 15966 7924 14968 15261 25614 28774 35313 45080 40982 24150 54941 59665 64400 Top-up OilPrime Mover Repair & Maint 42000 28500 57000 47250 89250 81900 126000 151200 170100 206400 192000 133500 320400 320400 380000 Prime Mover Repair & MaintAuxiliary Repair & Maint 30000 60000 135000 180000 Auxiliary Repair & MaintTrailer Repair & Maintenance 55000 66000 88000 88000 135000 153000 153000 170000 Trailer Repair & MaintenanceTotal Repair & Maintenance 42000 58500 117000 47250 89250 81900 181000 217200 305100 294400 280000 268500 653400 473400 550000 Total Repair & MaintTotal Tyres 6493 5980 21280 15960 229500 38480 80133 52560 59265 96640 96640 82400 128520 148320 164800 Total TyresUnforeseen Expense 20000 30000 30000 50000 50000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 Unforeseen ExpenseTOTAL VARIABLE 242515 304980 503567 279619 683077 540871 899020 974024 1205928 1437720 1337258 958050 2035686 1974679 2167200 TOTAL VARIABLEAs a % of Total Cost 41,52% 38,01% 45,91% 36,31% 58,36% 41,83% 52,75% 57,05% 55,17% 61,24% 58,29% 49,89% 61,81% 63,69% 65,91% As a % of Total costTOTAL OPERATING COSTS 584117 802320 1096839 770140 1170401 1293086 1704302 1707243 2185755 2347812 2294190 1920274 3293613 3100279 3288310 TOTAL OPERATING COSTSSUMMARY SUMMARYStanding Cost Rands per/day 1314 1913 2282 1887 1874 2893 3097 2820 3769 3500 3681 3364 4398 3936 3920 Standing Cost p/dayStanding Cost (Rands/Km) 6,83 16,58 9,89 10,90 5,73 11,57 8,05 6,11 7,26 5,69 5,98 12,83 6,99 6,25 5,61 Standing Cost (Rands)Variable Cost (Rands/Km) 4,85 10,17 8,39 6,21 8,04 8,32 8,99 8,12 8,93 8,99 8,36 12,77 11,31 10,97 10,84 Variable Cost (Rands)Total CPK (Rands/Km) 11,68 26,74 18,28 17,11 13,77 19,89 17,04 14,23 16,19 14,67 14,34 25,60 18,30 17,22 16,44 Total CPK (Rands)Cost per ton (Rands) 749 882 767 370 563 355 252 313 623 347 353 224 384 319 319 Cost per ton (Rands)Cost per Pallet (Rands) 771 703 370 563 622 273 328 525 376 368 384 301 319 Cost per Pallet (Rands)Cost per Ton/Km (100% Load) R 3,89 R 7,64 R 3,32 R 2,14 R 1,72 R 1,42 R 0,66 R 0,68 R 1,20 R 0,56 R 0,57 R 0,85 R 0,61 R 0,51 R 0,46 Cost per Ton/Km (100% Load)Cost per Ton/Km (75% Load) R 5,19 R 10,19 R 4,43 R 2,85 R 2,29 R 1,89 R 0,87 R 0,90 R 1,60 R 0,75 R 0,76 R 1,14 R 0,81 R 0,68 R 0,61 Cost per Ton/Km (75% Load)Cost per Ton/Km (50% Load) R 7,79 R 15,28 R 6,65 R 4,28 R 3,44 R 2,84 R 1,31 R 1,35 R 2,40 R 1,13 R 1,15 R 1,71 R 1,22 R 1,01 R 0,91 Cost per Ton/Km (50% Load)Cost per Pallet/Km (100%) R 6,69 R 3,05 R 2,14 R 1,72 R 2,49 R 0,71 R 0,71 R 1,01 R 0,61 R 0,60 R 0,61 R 0,48 R 0,46 Cost per Pallet/Km (100%)Cost per Cube/Km (100%) R 0,73 R 1,34 R 0,49 R 0,46 R 0,84 Cost per Cube/Km (100%)Cost per Deck Metre (Rands) 735 649 395 600 663 437 525 1001 669 654 783 602 639 Cost per Deck Metre (Rands)RATIOS RATIOSUseful Life Cost 3504700 6418558 6581032 6161116 9363206 10344690 13634418 8536216 13114533 11739061 11470950 15362194 16468063 15501393 13153240 Useful Life CostCapital Cost per Payload Ton 124373 229420 196739 91483 90108 93583 62660 64604 146452 64045 70728 69167 88592 65672 61107 Capital Cost per Payload TonCapital Cost per Deck Metre 93279 191183 166471 97582 96115 174687 108610 108535 235369 123346 130979 180800 124047 122213 Capital Cost per Deck MetreCapital Cost % Useful Life Cost 10,65% 12,51% 16,44% 11,88% 7,70% 12,67% 11,95% 15,89% 15,08% 14,18% 15,41% 13,51% 16,14% 14,40% 16,72% Capital Cost % Eco Life CostOper Cost per Payload Ton 194706 229234 199425 96267 146300 92363 65550 81297 161908 90300 91768 64009 109787 91185 91342 Oper Cost per Payload TonOper Cost per Deck Metre 146029 191029 168744 102685 156053 172411 113620 136579 260209 173912 169940 224055 172238 182684 Oper Cost per Deck MetreCapital Cost % Operating Cost 63,88% 100,08% 98,65% 95,03% 61,59% 101,32% 95,59% 79,47% 90,45% 70,92% 77,07% 108,06% 80,69% 72,02% 66,90% Capital Cost % Operating CostMaint Cost % Variable Costs 17,32% 19,18% 23,23% 16,90% 13,07% 15,14% 20,13% 22,30% 25,30% 20,48% 20,94% 28,03% 32,10% 23,97% 25,38% Maint Cost % Variable CostMaintCost % Operating Cost 7,19% 7,29% 10,67% 6,14% 7,63% 6,33% 10,62% 12,72% 13,96% 12,54% 12,20% 13,98% 19,84% 15,27% 16,73% Maintenance Cost % Operating CostFuel Cost % Variable Cost 68,34% 65,73% 63,41% 56,68% 43,83% 56,43% 56,98% 59,08% 58,56% 62,71% 61,29% 50,41% 53,98% 60,43% 59,43% Fuel Cost % Variable CostFuel Cost % Operating Cost 28,37% 24,99% 29,11% 20,58% 25,58% 23,60% 30,06% 33,71% 32,31% 38,40% 35,73% 25,15% 33,36% 38,49% 39,17% Fuel Cost % Operating CostCO2 (tons pa) 40,76 49,31 83,85 38,98 73,63 75,08 126,00 141,55 173,25 221,76 201,60 118,80 270,27 293,51 316,80 CO2 (tons pa)Redisa (R2.30/Kg) 331 119 368 280 1049 1322 3277 2219 2365 4159 4159 3729 5696 6713 7458 Redisa (R2.30/Kg)

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2017 / VOL 52 FLEETWATCH 55

FLEETWATCH MARKET RELATED TRUCK OPERATING BENCHMARKS (Per Annum) 02-August-17

OPERATION Short Med Long Med Long Truck Truck & 12.5 m 8.4 m 13.5 m 13.5m End 14,7 Taut-liner Flat deck OPERATIONHaul Haul Haul Long Haul Med Trailer Dual-axle Insulated Dual-axle Tridem-axle Tridem Tip Tridem Reefer Interlink InterlinkMetro Haul Long Haul Semi Med Haul Semi Semi Semi Semi

ASSUMPTIONS ASSUMPTIONSVehicle Type Panel Van Insulated Insulated Volume Flat 6x4 Rigid 6x4 Rigid 4-axle 6x2 5-axle 5-axle 6-axle 6-axle 7-axle 7-axle Vehicle Type

Van Van Van Van Deck & Trailer Artic Rigid Artic Artic Artic Artic Artic ArticAverage Payload (tons) 3 3,5 5,5 8 8 14 26 21 13,5 26 25 30 30 34 36 Average Payload (tons)Deck Length ( metres) 4 4,2 6,5 7,5 7,5 7,5 15 12,5 8,4 13,5 13,5 14,7 18 18 Deck Length ( metres)Pallets 4 6 8 8 8 24 20 16 24 24 30 36 36 PalletsCubes 16 20 37 37 30,5 92 Cubes Annual KM 50000 30000 60000 45000 85000 65000 100000 120000 135000 160000 160000 75000 180000 180000 200000 Annual KMWorking Days 260 260 260 260 260 260 260 260 260 260 260 286 286 286 286 Working DaysShift Hours (fridge) 11 11 10 Shift Hours (fridge)Useful Life (KM) 300000 350000 350000 450000 600000 800000 800000 600000 800000 800000 800000 600000 800000 800000 800000 Useful Life (KM)Useful Life (Years) 6 8 6 8 8 8 8 5 6 5 5 8 5 5 4 Economic Life (Years)CAPITAL COST CAPITAL COSTPrime Mover 373118 395829 621863 621863 621863 1172655 1172655 1070685 1359600 1379170 1449210 1500000 1485260 1616843 1616843 Prime MoverBody 137500 145200 110000 99000 137500 137500 302500 BodyAuxiliary Equipment 269640 315000 315000 472500 auxiliary Equipment1st Trailer 319000 286000 286000 319000 575000 700000 220000 209000 1st Trailer2nd Trailer 396000 374000 2nd TrailerOther OtherTotal Capital Cost 373118 802969 1082063 731863 720863 1310155 1629155 1356685 1977100 1665170 1768210 2075000 2657760 2232843 2199843 Total Capital CostSTANDING COST STANDING COSTPrime Mover Depreciation 74624 79166 124373 124373 124373 234531 234531 214137 271920 275834 289842 300000 297052 323369 323369 Prime Mover DepreciationBody Depreciation 27500 21780 16500 14850 20625 45375 Body DepreciationAuxiliary Depreciation 50558 59063 59063 88594 Auxiliary DepreciationTrailer Depreciation 23925 21450 23925 53906 52500 46200 43725 Trailer DepreciationTotal Depreciation 74624 157223 205215 140873 139223 255156 258456 214137 376358 297284 313767 353906 438146 369569 367094 Total DepreciationCost of Capital 24506 52739 71070 48069 47346 86051 107003 89107 129856 109368 116136 136286 174562 146653 148181 Cost of CapitalPrime Mover Licence 1488 2112 4890 4890 4890 16227 16227 9480 11532 11532 14433 17763 17763 17763 17763 Prime Mover LicenceTrailer Licence 4890 4944 5700 5700 16404 16404 12432 11364 Trailer LicenceTotal Licence Fee 1488 2635 4890 4890 4890 16227 21117 14424 11532 17232 20133 34167 34167 30195 29127 Total Licence FeeTotal Insurance 27984 60223 81155 54890 54065 98262 122187 101751 148283 124888 132616 155625 199332 167463 164988 Total InsuranceDriver Wages 115200 126720 133142 144000 144000 198720 198720 216000 216000 263520 276480 282240 313920 313920 313920 Driver WagesAssistant Wages 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 97800 Assistant WagesTotal Wages 213000 224520 230942 241800 241800 296520 296520 313800 313800 361320 374280 282240 411720 411720 411720 Total WagesTOTAL STANDING COST 341602 497340 593272 490521 487323 752216 805283 733219 979828 910092 956932 962224 1257926 1125600 1121110 TOTAL STANDINGAs a % of Total Cost 58,48% 61,99% 54,09% 63,69% 41,64% 58,17% 47,25% 42,95% 44,83% 38,76% 41,71% 50,11% 38,19% 36,31% 34,09% As a % of Total costVARIABLE COST VARIABLE COSTPrime Mover Fuel 165735 130038 270480 158484 299359 305229 512273 575489 633938 901600 819636 483000 1014300 1193294 1288000 Prime Mover FuelAuxiliary Fuel 70438 48841 72313 84525 Auxiliary FuelTotal Fuel 165735 200476 319321 158484 299359 305229 512273 575489 706250 901600 819636 483000 1098825 1193294 1288000 Total FuelTop-up Oil 8287 10024 15966 7924 14968 15261 25614 28774 35313 45080 40982 24150 54941 59665 64400 Top-up OilPrime Mover Repair & Maint 42000 28500 57000 47250 89250 81900 126000 151200 170100 206400 192000 133500 320400 320400 380000 Prime Mover Repair & MaintAuxiliary Repair & Maint 30000 60000 135000 180000 Auxiliary Repair & MaintTrailer Repair & Maintenance 55000 66000 88000 88000 135000 153000 153000 170000 Trailer Repair & MaintenanceTotal Repair & Maintenance 42000 58500 117000 47250 89250 81900 181000 217200 305100 294400 280000 268500 653400 473400 550000 Total Repair & MaintTotal Tyres 6493 5980 21280 15960 229500 38480 80133 52560 59265 96640 96640 82400 128520 148320 164800 Total TyresUnforeseen Expense 20000 30000 30000 50000 50000 100000 100000 100000 100000 100000 100000 100000 100000 100000 100000 Unforeseen ExpenseTOTAL VARIABLE 242515 304980 503567 279619 683077 540871 899020 974024 1205928 1437720 1337258 958050 2035686 1974679 2167200 TOTAL VARIABLEAs a % of Total Cost 41,52% 38,01% 45,91% 36,31% 58,36% 41,83% 52,75% 57,05% 55,17% 61,24% 58,29% 49,89% 61,81% 63,69% 65,91% As a % of Total costTOTAL OPERATING COSTS 584117 802320 1096839 770140 1170401 1293086 1704302 1707243 2185755 2347812 2294190 1920274 3293613 3100279 3288310 TOTAL OPERATING COSTSSUMMARY SUMMARYStanding Cost Rands per/day 1314 1913 2282 1887 1874 2893 3097 2820 3769 3500 3681 3364 4398 3936 3920 Standing Cost p/dayStanding Cost (Rands/Km) 6,83 16,58 9,89 10,90 5,73 11,57 8,05 6,11 7,26 5,69 5,98 12,83 6,99 6,25 5,61 Standing Cost (Rands)Variable Cost (Rands/Km) 4,85 10,17 8,39 6,21 8,04 8,32 8,99 8,12 8,93 8,99 8,36 12,77 11,31 10,97 10,84 Variable Cost (Rands)Total CPK (Rands/Km) 11,68 26,74 18,28 17,11 13,77 19,89 17,04 14,23 16,19 14,67 14,34 25,60 18,30 17,22 16,44 Total CPK (Rands)Cost per ton (Rands) 749 882 767 370 563 355 252 313 623 347 353 224 384 319 319 Cost per ton (Rands)Cost per Pallet (Rands) 771 703 370 563 622 273 328 525 376 368 384 301 319 Cost per Pallet (Rands)Cost per Ton/Km (100% Load) R 3,89 R 7,64 R 3,32 R 2,14 R 1,72 R 1,42 R 0,66 R 0,68 R 1,20 R 0,56 R 0,57 R 0,85 R 0,61 R 0,51 R 0,46 Cost per Ton/Km (100% Load)Cost per Ton/Km (75% Load) R 5,19 R 10,19 R 4,43 R 2,85 R 2,29 R 1,89 R 0,87 R 0,90 R 1,60 R 0,75 R 0,76 R 1,14 R 0,81 R 0,68 R 0,61 Cost per Ton/Km (75% Load)Cost per Ton/Km (50% Load) R 7,79 R 15,28 R 6,65 R 4,28 R 3,44 R 2,84 R 1,31 R 1,35 R 2,40 R 1,13 R 1,15 R 1,71 R 1,22 R 1,01 R 0,91 Cost per Ton/Km (50% Load)Cost per Pallet/Km (100%) R 6,69 R 3,05 R 2,14 R 1,72 R 2,49 R 0,71 R 0,71 R 1,01 R 0,61 R 0,60 R 0,61 R 0,48 R 0,46 Cost per Pallet/Km (100%)Cost per Cube/Km (100%) R 0,73 R 1,34 R 0,49 R 0,46 R 0,84 Cost per Cube/Km (100%)Cost per Deck Metre (Rands) 735 649 395 600 663 437 525 1001 669 654 783 602 639 Cost per Deck Metre (Rands)RATIOS RATIOSUseful Life Cost 3504700 6418558 6581032 6161116 9363206 10344690 13634418 8536216 13114533 11739061 11470950 15362194 16468063 15501393 13153240 Useful Life CostCapital Cost per Payload Ton 124373 229420 196739 91483 90108 93583 62660 64604 146452 64045 70728 69167 88592 65672 61107 Capital Cost per Payload TonCapital Cost per Deck Metre 93279 191183 166471 97582 96115 174687 108610 108535 235369 123346 130979 180800 124047 122213 Capital Cost per Deck MetreCapital Cost % Useful Life Cost 10,65% 12,51% 16,44% 11,88% 7,70% 12,67% 11,95% 15,89% 15,08% 14,18% 15,41% 13,51% 16,14% 14,40% 16,72% Capital Cost % Eco Life CostOper Cost per Payload Ton 194706 229234 199425 96267 146300 92363 65550 81297 161908 90300 91768 64009 109787 91185 91342 Oper Cost per Payload TonOper Cost per Deck Metre 146029 191029 168744 102685 156053 172411 113620 136579 260209 173912 169940 224055 172238 182684 Oper Cost per Deck MetreCapital Cost % Operating Cost 63,88% 100,08% 98,65% 95,03% 61,59% 101,32% 95,59% 79,47% 90,45% 70,92% 77,07% 108,06% 80,69% 72,02% 66,90% Capital Cost % Operating CostMaint Cost % Variable Costs 17,32% 19,18% 23,23% 16,90% 13,07% 15,14% 20,13% 22,30% 25,30% 20,48% 20,94% 28,03% 32,10% 23,97% 25,38% Maint Cost % Variable CostMaintCost % Operating Cost 7,19% 7,29% 10,67% 6,14% 7,63% 6,33% 10,62% 12,72% 13,96% 12,54% 12,20% 13,98% 19,84% 15,27% 16,73% Maintenance Cost % Operating CostFuel Cost % Variable Cost 68,34% 65,73% 63,41% 56,68% 43,83% 56,43% 56,98% 59,08% 58,56% 62,71% 61,29% 50,41% 53,98% 60,43% 59,43% Fuel Cost % Variable CostFuel Cost % Operating Cost 28,37% 24,99% 29,11% 20,58% 25,58% 23,60% 30,06% 33,71% 32,31% 38,40% 35,73% 25,15% 33,36% 38,49% 39,17% Fuel Cost % Operating CostCO2 (tons pa) 40,76 49,31 83,85 38,98 73,63 75,08 126,00 141,55 173,25 221,76 201,60 118,80 270,27 293,51 316,80 CO2 (tons pa)Redisa (R2.30/Kg) 331 119 368 280 1049 1322 3277 2219 2365 4159 4159 3729 5696 6713 7458 Redisa (R2.30/Kg)

56 FLEETWATCH VOL 52 / 2017

truck operating benchmarks

Comment by Max Braun

COST OF CAPITAL“There’s no free lunch” as the saying

goes. Interest on the cost of vehicles and equipment is calculated at the prime bank overdraft rate (currently 10.25% a year) on the full amount. The calculation indicates the average interest paid per annum on the reducing balance over five years.

VEHICLE LICENCESLicence fees for vehicles and trailers are

based on the current Western Cape tariff, among the most expensive among the nine provincial governments.

INSURANCEInsurance cost assumes the operator

has a low risk rating. Premiums are presently set at 7 per cent of the purchase price (replacement value) for vehicles, equipment and trailers.

WAGESDriver and assistant wages vary

considerably across the country in terms of vehicle size, task complexity, region, metropolitan operators and remuneration packages. All assumptions include an allowance for company contributions but exclude overtime and bonuses. Where applicable an assistant has been included as a casual, daily worker.

VARIABLE COSTSVariable costs (also known as running

costs) are incurred when the wheels turn. These include:

FUELA major cost item in all transport

operations. Where annual kilometres exceed about 120000 km a year, fuel is usually the largest expense. Fuel consumption is calculated according to a formula that assumes the vehicle is always fully loaded, travels at an average speed of approximately 80% of the speed limit in the case of highway operations and 75% of the urban speed limit. The formula takes into account an assumed maximum power demand expressed as a percentage of maximum available kW/hrs for each task. A similar approach is used in calculating the fuel used by fridge units. The price of fuel is based on the pump price in Gauteng for diesel with 500 ppm sulphur. Bulk rebates where they apply are ignored.

TOP-UP OILIs based on five per cent of the cost

of fuel consumed.

REPAIRS & MAINTENANCEThe assumed cost of maintenance is

based on current vehicle manufacturer and FML maintenance contract rates, expected economic component life and industry experience. The assumptions take into account the complexity of each task including typical operating conditions such as roads, topography, traffic density etc. Repair and maintenance costs for the tipper and fridge operations are calculated in hours.

TYRESTyre life is based on typical casing

life currently experienced in the various operations. The benchmarks exclude tyre management charges, breakdown and recovery costs or other allied expenses incurred. Major tyre supplier tyre management programmes offer excellent data to establish achievable tyre performance.

UNFORESEENAn annual appropriate amount

is allowed to cover any number of unexpected and unforeseen expenses such as insurance excess and the cost of unrecoverable incidents.

EXCLUSIONSThe estimates do not include

toll fees, vehicle tracking, engine protection or other optional equipment. No allowance is made for administration or overhead expenses. The variation in operator approach to such costs excludes the inclusion of a sensible amount to cover these aspects.

SUMMARYThe summary expresses operating

costs under numerous headings including tons, ton/km, pallets, pallet/km, metres of deck length and cubic metres. It is important to note that all calculations assume a fully loaded vehicle – in other words a 100% load factor.

RATIOSManagement ratios provide

an excellent insight into the high capital and operating cost of vehicles, especially when not properly managed. However, correctly selected vehicles that are decently driven and timeously maintained offer shippers cost-effective transport and the prospect of a commercially acceptable return for the operator.

THE DIESEL PRICE increase of 29 cpl for August 2017 keeps fuel cost of operating expenses at between 34% and 38% depending of annual kilometres and vehicle configuration for six and seven axle rigs. The outlook for the oil price is presently range bound between US$50 and $55 depending on the strength of the Rand. The recent 25 point cut in the interest rate provides tiny relief in fixed costs. However, the shadow of further ratings downgrades casts a shadow over ongoing fixed costs for trucking.

A deeper look into new tyre sales confirms at least 50% emanate from Asia and China.

Reports confirm some of the latest Asian tyres have proved to be better than earlier casings. Given the difference in casing prices with established brands the new casing benchmarks have been adjusted accordingly. The outlook for retreads is less favourable due to the 90% increase in carbon black early this year. Prices are expected to rise by about 10% before year end.

Pressure on OEMs to hold onto market shares is reflected in few if any meaningful increases in vehicle prices. Local loadbody and trailer builders are finding it difficult to hold prices to at least cover costs. Several OEMS are offering attractive deals when new vehicles are purchased and paid for over 36 months. Deals include attractive buy-backs and maintenance contract rates at between 45 and 60 cpk dependent on a maximum of 600 000 or 800 000 kilometres. With the CPK somewhere between 16 and 18 cpk and standing costs per day close to R4000 before overhead expenses and toll fees keeps bottom lines under severe pressure q

2017 / VOL 52 FLEETWATCH 57

truck operating benchmarksROAD TRANSPORT COST COMPARISON

Based on a 7-axle Interlink covering 200 000 kmpa, working 286 days a year

As at Dec 2014 2015 2016 2017** % change Average pa

Equipment Cost 2099750 2199843 2199843 2199843 stat 1.85%

Interest (prime) 9.25% 9.75% 10.50% 10.25% -2.38% 3.86%

Fixed Costs 969359 1036026 1073542 1121110 4.43% 3.80%

Running Costs 1911642 1863684 2077908 2167200 4.30% 4.62%

TOTAL COSTS* 2881001 2899710 3151450 3288310 4.34% 4.34%

Fuel Cost 1294846 1235023 1212103 1288000 6.26% 0.75%

Fuel cpl 11.330 10.510 10.61 11.27 6.22% 0.50%

Fuel % of Total Costs 44.94% 42.61% 38.46% 39.17% 1.85% -3.14%

Standing Cost /day 3389 3622 3754 3920 4.42% 3.80%

RPK 14.41 14.5 15.76 16.44 4.31% 4.92%

C/Tkm 100% Lfactor 40 40 44 46 4.55% 4.29%

C/Tkm 50% Lfactor 80 80 88 92 4.55% 4.29%

* as at August 2017

NB: the data excludes overhead expenses and toll fees

NOTEThese truck operating cost benchmarks

offer shippers and operators the opportunity to fine tune these estimates to suit their specific transport needs and actual operating costs. Where particular elements differ from your operations you may simply make the adjustments.

If, however, you require more information to complete your benchmarks, contact Max Braun at maxbraun@iafrica.com for some assistance. q

www.iveco.co.za

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A4 Full Range Advert.pdf 1 2017/08/03 3:38 PM