Trucking Has a Balancing Act in Vehicle Utilization

Fleet managers are walking a tightrope. Between lagging vehicle production and a hot aftermarket, fleets are figuring how to balance deliveries today with lifecycle management.

Despite these challenges with vehicle inventory, the opportunity is clear. Though procurement cycles have typically occurred in 4-5 year cycles, and market conditions have pushed vehicles into their fifth and sixth campaigns, fleets now have the additional support of predictive maintenance to optimize utilization decisions today and their replacement orders to come.

In this blog, we'll cover what vehicle utilization is, how fleets have looked to it as a benchmark of operational performance, and the ways that predictive maintenance enables fleets to better manage utilization.

You’ll get a different answer about what vehicle utilization is depending on the person you ask. Most see it as as the number of vehicles in service that are making revenue at any given time, out of the total number of vehicles a fleet has.

Vehicle utilization should also be distinguished from vehicle availability.

• Availability: how many vehicles are ready to run and are running now.

• Utilization: how many vehicles are running now and generating revenue.

As opposed to a metric like availability, utilization lends business insight into the alignment of vehicles in service with revenue activity.

Utilization is tricky to track, but it can be measured in a few ways.

• Revenue miles / total miles

• Time in revenue operations / total time on the road

• Percentage of vehicles in revenue operations / revenue outcomes as a percentage of total vehicles in operation

No one benchmark for utilization fits all fleets. “Low” utilization rates aren’t strictly bad, and neither are high rates necessarily good.

Good utilization depends on business priorities, procurement schedules, and spare parts inventory. Consistency is key.

Changes in vehicle utilization could be influenced by many factors. Efficient route planning, wrench time, downtime metrics, driver retention, and driving conditions could also explain utilization rates.

City bus fleets, for example, often have 90% utilization during rush hours. Service-oriented fleets, like utilities responding to power outages, may also see the same peaks and valleys in their utilization.

Since vehicle utilization tracks revenue-aligned activity, it offers a snapshot of capital expenses or lifecycle management. The more specific that fleets can get with their understanding of vehicle utilization, breaking it down by vehicle manufacturer, shop, or shop region, the better understanding they have of how profitable their load assignments and maintenance management are.

As of late, vehicle utilization has surpassed 80% at large trucking operations. At the start of the pandemic, the figure hovered around 75%. And before then, fleets were using some 70-75% of their vehicles at any given time.

Though it means that carriers are deploying more of their fleet, it’s not exactly that the fleet is running more efficiently.

For one, vehicle utilization only partially reflects overall business efficiency. Anywhere from a quarter to a third of total runs over the lifetime of a vehicle are empty. For truckload companies, metrics like capacity utilization provide better day-to-day visibility into the performance of the business.

And second, the increase in truck utilization points to a stressor in fleet management today: lifecycle management amid disruptions in the supply chain.

Vehicles are depreciating quicker than expected due to heavier duty cycles. They are having to make do with older vehicles, even as the shortage of replacement parts is leaving vehicles backed up in the shop.

Vehicle utilization is one area where we’ve seen predictive maintenance make a difference for our customers.

Predictive analytics gives fleets a future-looking profile of vehicle performance. So as predictive maintenance allows fleets to know precisely when vehicles and which of their components need attention — before a road call, tow, or derate. They have the backing to reduce unplanned downtime.

Fleets have improved uptime with predictive maintenance in these ways:

• Overview of high-risk vehicles in the fleet to prioritize maintenance effectively, or route-ready vehicles to validate route planning

• Catches on catastrophic failure events before they cause derates, roadside breakdowns

• Advanced warning enables proactive diagnostics and improved wrench time, lowering downtime

• Bundled repairs for vehicles with multiple critical issues

• Proactive orders on replacement parts

Uptake Fleet shows vehicle failures by individual components. Over time, fleets gain a profile of the most common and expensive issues.

With disruptions continuing to make their mark across the supply chain, fleet management has the advantage of knowing which of their components will likely need parts in the future.

As fleets strike a balance between uncertain inventory and heavy-duty cycles, predictive maintenance offers a steady hand. By reducing unplanned downtime and improving maintenance efficiency, predictive maintenance ensures that utilization aligns with deliveries today and lifecycle management down the road.

Ready to put your data to work for smarter utilization?