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F&S: Driver Pay Becoming Bigger Part of Total Cost of Operation

A trend analysis of fleet manager surveys conducted by global research firm Frost & Sullivan over the last half decade indicates that “total cost operation” (TCO) calculations are now front and center and concerns for trucking companies – with driver pay becoming far more critical to TCO than in the past, Fleet Owner reports.

Driver wages are now poised to be a far larger piece within TCO than fuel costs,” Sandeep Kar, global VP of automotive & transportation research for the firm, told Fleet Owner. “That’s one of the biggest trend shifts we’ve seen in the last five years.”

Lakshmi Ramanujam, one of Frost’s industry analysts, extrapolated from the firm’ fleet manager survey data how the trend focus on TCO and driver wages might influence fleet spec’ing strategies. For example:

  • Demand for automated manual transmissions (AMTs) and fully automatic gearboxes is expected to climb 23% in total this year;
  • Electronic stability control (ESC) systems should experience a growth rate of 12% in 2015;
  • Automatic tire inflation systems for trailers should witness a 32% demand spike this year.

The focus on TCO is also driving demand for more data analytics, especially in terms of prognostic maintenance capability:

  • Some 26% of the overall trucking fleet used some sort of prognostic capability by the end of 2014, with growth in prognostic demand expected to top 29% by the time 2015 comes to a close;
  • About 52% of fleet managers consider engine-related diagnostic information the most valuable to their operation;
  • Another 55% are interested in integrating remote/prognostic data with maintenance management system and parts inventories.

Full article here.

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