Bob Ulrich

Editor

Bob Ulrich was named Modern Tire Dealer editor in August 2000. He joined the magazine in 1985 as assistant editor, and has been responsible for gathering statistical information for MTD's "Facts Issue" since 1993. He has won numerous awards for editorial and feature writing, including five gold medals from the International Automotive Media Association. Bob earned a B.A. in English literature from Ohio Northern University and has a law degree from the University of Akron.

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What the future holds for fleet tire and maintenance costs

By: Bob Ulrich

Are automotive fleet trends an indication of the aftermarket? They seem to be.

In the March issue of Automotive Fleet (www.automotive-fleet.com), Editor Mike Antich wrote about rising maintenance costs, citing three segments in particular:

1. replacement tires,

2. oil changes and

3. labor rates.

Tire expenses were up in 2009 vs. 2008, according to the article.

"Average per-tire costs are up 6% over the past three years, while tire costs on a per-vehicle basis are up over 40% over the same period because of the extended vehicle cycling and need for additional tires," said Eric Strom, maintenance and safety product manager for GE Capital Fleet Services.

The 6% increase -- which only applies to fleets -- compares to a 9% increase in overall replacement passenger tire pricing -- which includes consumers -- from 2006 to 2009, according to Modern Tire Dealer's "Facts Issues."

Other issues faced by fleets in 2009 included the use of "non-major brand tires with unique tire sizes" by original equipment manufacturers (which left fleet owners with fewer point of purchase options) and the increasing use of tires with comparatively lower rolling resistance.

"The national account tire providers have shown a strong focus on lifecycle cost reduction with improved fuel economy tires," said Strom.

How much did tires cost the average fleet in 2009? GE Capital research reveals the following:

Tire cost per vehicle per month: $20.04 (compared to $12.04 in 2007).

Tire cost per mile: 1.01 cents (compared to 0.71 cent in 2007).

Fleet oil change intervals have lengthened, yet the "preventive maintenance expense" of oil changes went up. Why? Oil changes increased more than 10% over the last three years, said Strom. Also, there was a noticeable, albeit slight, shift to synthetic oils for some models.

(Based solely on advertised pricing in the aftermarket, the price of oil changes has risen nearly 20% since 2006, according to Modern Tire Dealer.)

Finally, billable labor rates for consumer motor vehicle repairs increased 2.5% from 2008 to 2009, according to the Consumer Price Index.

And for 2010-2011? Fleet maintenance expenses will continue to rise at companies that "do not accelerate vehicle replacement cycles," said Alyssa Dwyer, strategic consultant for GE Capital.

Individually, fleet costs for replacement tires, oil changes and repairs "will rise slightly... despite the low inflation rate."

Related Topics: Automotive Fleet, Facts Issue, GE Capital, Green, Preventive maintenance