Parts, labor costs stabilizing, VMRS report says

Updated Mar 8, 2024
Rob Ziemba from Decisiv presents a VMRS report at TMC.

Parts and labor costs are moderating, Decisiv reported at the American Trucking Association's Technology and Maintenance Council (TMC) annual meeting in New Orleans on Sunday. 

Decisiv expanded its 2023 report from nine to 25 VMRSs, covering more than 97% of total parts and labor costs, says Rob Ziemba, Decisiv's senior director of marketing. 

"They're actually getting deeper into what's going on in the shops," says Jack Poster, VMRS services manager for TMC. In addition to expanded VMRSs, Poster says this year, the data is also available via a portal which will allow licensees directly into the database. 

"It's everything you wanted to know about VMRS in one big package," Poster says. 

Decisiv analyzes service operations using machine learning and AI algorithms to interpret service information captured during the creation of the repair order. Individual operations are then encoded in the VMRS system. 

"This is very comprehensive data that we're able to provide on parts and labor costs," Ziemba says. 

The top items in cost remain the same as in previous years, Ziema says, with the powerplant, exhaust, cooling and brakes topping the list. The good news: parts costs have come down 2.2% from 2022, helping to moderate an increase in labor costs by 4% in the same period. 

"We're happy to report that parts and labor costs were actually down 1.4%," Ziema says. Newer trucks hitting the road and supply chain problems easing allowing parts prices to finally start to drop. 

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Labor costs, however, are rising and will continue to do so, Ziemba says. He says both the U.S. government, via the Bureau of Labor Statistics, and industry groups, such as the TechForce Foundation, predict the diesel technician shortage to only get worse in the coming years.

"All that pressure on the technician market and recruiting of technicians, we're not seeing that going away," Ziemba says. 

For now, that pressure is being somewhat moderated by the drop in parts prices. A decrease in freight tonnage combined with newer trucks hitting the road and kinks working out of the supply chain has parts prices coming down consistently. 

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"It's back to a normal trend," Ziemba says, calling 2023 "a year of moderation." 

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Top increases for 2023 over 2022 included cab and sheet metal, which was been consistently increasing over the past few quarters and power take-off, which had the highest year-over-year increase in both parts and labor. 

Top decreases went to frame systems (code 014) and tires, which both saw decreases in both parts and labor. Ziemba says tire costs could be down because of increased acceptance of advanced maintenance tools such as tire pressure monitoring systems and a higher quality portfolio of commercial tires. The lower tire costs could also come from fewer miles driven because of less freight demand, Ziemba says. 

Decisiv also looks at costs by region. The western U.S. has the highest overall parts and labor costs while the lowest are in the Midwest and Canada, Ziemba says. 

"If you're a fleet that's operating in multiple regions, you can try to take advantage of these factors by repairing your truck in the Midwest or Canada and try to avoid repairs in the west," Ziemba says. He also stressed that service locations' efficiency also has a big impact on cost. 

"We an look at factors like the weather or number of miles," he says, "but it's important to look at the cost quality of service being provided. We can see some very significant differences in how more efficient providers are reducing costs for their customers."