As the backbone of the global economy, the trucking industry plays a pivotal role in transporting goods across vast distances, ensuring shelves are stocked, and businesses thrive. However, beneath its essential role lies a daunting reality – a continuous struggle to stay profitable amidst increasing expenses.
The mounting pressure caused by issues like inflation and supply chain disruptions are pretty well documented. These economic concerns are taking a toll on the trucking industry in very specific and measurable ways. Key categories such as fuel prices, insurance premiums, driver wages, and maintenance costs, have increased dramatically putting pressure on trucking professionals to find ways to save.
Below we will discuss the impact rising costs are having on 4 major economic drivers in the trucking industry and how some companies are finding savings in one unexpected place: changeable fleet graphics.
The Impact of Rising Costs
Of the current economic pressures facing the trucking industry, there are 4 specific areas the American Transportation Research Institute has focused on in there Analysis of the Operational Costs of Trucking
1. Fuel Prices
2. Insurance Premiums
3. Driver Wages
4. Maintenance Cost
Let’s take a minute to examine how much the prices in each of those areas have increased and what impact they are having on trucking companies.
The Cost of Fuel
The price of fuel is a major determinant in the profitability of trucking operations. Fluctuating fuel prices have long been a concern for the industry, and recent years have witnessed unprecedented volatility. Infact, according to the U.S. Energy Information Administration,
“No, 2 diesel fuel prices rose by 53% from January 2019 to January 2023.“
Such a sharp increase has seen profit margins shrink rapidly, leaving little room for maneuverability. Moreover, the increased burden of fuel expenses has hindered investment in modernizing fleets and adopting eco-friendly technologies, impeding progress towards a more sustainable and efficient trucking industry. The ripple effect of these rising diesel fuel prices is being felt throughout the supply chain, impacting businesses, consumers, and ultimately, the overall health of the U.S. economy.
Rising Insurance Premiums
Insurance is a vital component of the trucking industry, providing protection against unforeseen risks and liabilities. However, the surge in insurance premiums has been relentless, adding significant financial strain on trucking companies.
Over the last 10 years, per-mile insurance premiums for commercial carriers have increased by almost 50%, according to the American Transportation Research Institute.
As insurance plays a critical role in mitigating risks and safeguarding businesses from potential liabilities, the higher premiums have forced many carriers to reassess their coverage levels, potentially exposing them to greater financial vulnerabilities.
With premiums soaring, many companies find it increasingly difficult to remain competitive, stifling their ability to invest in modernizing their fleets or adopting advanced safety measures.
Increasing Driver Wages
Skilled and experienced drivers are the lifeblood of the trucking industry, and their demand has never been greater. Yet, attracting and retaining drivers has become increasingly challenging due to escalating operational costs.
The median pay for a truckload driver in 2021 was $69,000 – an 18% increase from ATA’s previous survey in 2019.
While addressing the critical issue of driver compensation and retention, this significant increase in wages has led to a surge in operational costs for carriers. With the driver shortage already posing challenges, the wage hike has further strained the industry’s ability to attract and retain skilled drivers.
Maintenance Costs
Ensuring the safety and reliability of trucks is of paramount importance in the trucking world. Unfortunately, with operational costs on the rise, maintenance expenses have soared as well.
“In 2022, annual comparisons between quarters showed that combined parts and labor costs were up 15.3%, parts costs rose 15.8%, and labor expenses increased by 14.6%”
With maintenance expenses already accounting for a substantial portion of operational budgets, this additional burden is eroding profit margins and hampering the ability of trucking companies to reinvest in modernizing their fleets.
With the rise in operational expenses, trucking and fleet professionals have been forced to explore potential strategies that they can adopt to navigate these rough terrains successfully.
One Strategy That Has Proven Fruitful For Many Companies Is Finding Savings With Changeable Fleet Graphics.
Although a vital branding tool for many transportation segments, fleet graphics can prove to be a huge cost in both money and time. For larger fleets in multiple locations, the effort to brand or re-brand can quickly become another financial and logistical burden. Added to the ever increasing costs discussed earlier, it might seem hard to imagine how fleet graphics could become an area of savings. That’s where changeable fleet graphics can become a game changer.
When I refer to changeable fleet graphics, I am referring to “Frame and Banner” graphic systems in which non adhesive vinyl graphics can be removed, changed and reused rather quickly. As opposed to traditional semi truck wraps which can be very expensive and time consuming to maintain and change.
Save Money
Changeable fleet graphics can cost up to 50% less than traditional commercial fleet graphics and take half the time to install. That instant savings can go a long way to combating the rocketing cost of operating your fleet.
Because changeable fleet graphics install right over faded wraps, companies will see significant savings by eliminating the need for expensive wrap removal and surface prep.
Old dents, and scrapes disappear instantly when covered up by a seamless graphic that is stretched tightly by the frame perimeter. This technology gives you the ability to make old, beat up trailers look new without an expensive repair bill.
Imagine how much money you can save if you can convert old trailers into eye-catching rolling billboards that promote your brand.
Earn Money
Changeable fleet graphics provide trucking companies with a unique and lucrative opportunity to capitalize on co-promoting client brands on their trucks.
By incorporating a client’s brand or partnership into the truck’s graphics, these companies can effectively transform their fleet into mobile advertising billboards. This dynamic advertising approach allows trucking companies to generate additional revenue every month by leasing space on their vehicles to interested clients.
As trucks traverse long distances and travel through diverse regions, the client’s brand gains widespread visibility, reaching a broad and diverse audience. This mutually beneficial arrangement not only generates extra income for the trucking company, but allows the client to increase brand exposure and reach potential customers they might not have otherwise reached through traditional advertising channels.
The ability to adapt and change these graphics as needed enables trucking companies to accommodate different clients and campaigns, maximizing their earning potential and establishing long-term partnerships that boost revenue streams significantly.
Changeable fleet graphics present a game-changing solution for trucking companies seeking to tackle the mounting operational costs of running a fleet.
By providing a cost-effective alternative to traditional commercial fleet graphics, these adaptable designs save trucking companies up to 50% on their branding and advertising expenses.
Moreover, the elimination of expensive wrap removal costs further enhances the economic benefits of this innovative approach. Beyond cost savings, changeable fleet graphics also open new doors for revenue generation. By offering co-promotion opportunities that showcase client brands on their fleets, trucking companies can earn extra income every month while increasing brand exposure for their clients.
Embracing changeable fleet graphics is a strategic move that not only unlocks the power of mobile advertising, but can provide an excellent hedge against the ever rising costs of running a fleet.
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