The True Cost Per Mile of the Transportation and Logistics Industry

Logistics data is key to fleet operations and driving financial success for your trucking company. Are you interested in leveraging your logistics data? Perhaps you want a clearer picture of where your company budget is going, and how you can improve the operational costs of your fleet? One of the best ways to gain some insight into your internal investments is by calculating your cost per mile.

Cost per mile is a Key Performance Indicator (KPI) in the trucking industry and in this quick logistics guide, we’ll help you clarify and fully understand the true cost per mile in the transportation and logistics industry. We’ll also break down how you can calculate your own total cost per mile.

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How to Find Your Total Cost Per Mile

What Does Cost Per Mile Mean?

Cost per mile refers to the total cost to operate your fleet on a per-mile basis. This number will help you determine the total cost to own your fleet, thus helping you make better, more data-driven decisions that can improve your profits and optimize your fleet operations. Plus, having an understanding of your total cost per mile will make it easier to bid on potential loads and determine the return on investment for your jobs.

How to Find Your Cost Per Mile

Calculating your cost per mile is a pretty simple equation and using fleet management software is the easiest way to calculate it. Platforms — like TransPlus — have automated features that calculate your cost per mile, per fleet. However, there are some ways to calculate your truck costs on your own.

To find your trucking cost per mile, you will follow this formula: Fixed costs + Variable costs / Miles Driven = Your cost per mile. There may be additional expenses and indirect costs that do not fit neatly into either category that may need to be included in the equation and added to your costs.

Example: $50,000 + $150,000 / 120,000 = $1.66

Let’s break this down a bit more. Your fixed costs are the costs that do not change for each transport job. Some examples of fixed costs for the transportation industry include taxes, insurance premiums, and permits or licenses.

Examples of Fixed Costs for Cost Per Mile

• Truck and Equipment Payments
• Driver and Company Insurance Payments
• Licensing and Permits
• Taxes and Fees
• Depreciation of Equipment
• Additional Overhead Cost

Your variable costs will change on a job-by-job basis. They will also vary and fluctuate depending on how large your fleet is and how efficiently you are running your business. In general, the biggest variable expenses for fleets are fuel costs and maintenance fees. However, wages for your drivers, toll costs, and truck part replacement costs are also common variable costs to consider.

Examples of Variable Costs for Cost Per Mile

• Fuel Costs
• Maintenance and Repair Costs
• Tire Costs
• Driver Wages and Salaries
• Tolls and Weigh Station Fees
• Food and Per-Diem Costs for Drivers
• Detention and Loading Dock Fees
• Layover Fees

Other costs that may be considered either fixed or variable include tire maintenance, lease and purchase payments for the trucks themselves, truck driver benefits costs, etc.

Lastly, your miles driven will refer to the number of miles driven for a particular job.

It’s vital to have all this data and these metrics on hand to calculate your total cost per mile. Fleet management software can be a particularly helpful tool in calculating this number regularly, as well as gathering the necessary data to calculate it.

How To Reduce Your Cost Per Mile

There are a few ways companies can reduce their cost per mile for their fleets. To start, opting for fuel-efficient vehicles can help reduce the cost to regularly fuel your fleet, though the initial investment can be quite hefty and can take a while to be worth it. Managing and staying up to date with all of your fleet’s fuel receipts and connecting those inputs to your fleet management software can make a big difference.

Staying up to date with your vehicle preventative maintenance can cut down on costs related to regular maintenance and repairs. Using fleet management software can also help your management teams keep an eye on the routes that your truckers are taking to ensure the best possible mileage.

Strategies to Reduce Your Cost Per Mile

• Employ Fleet Management Software - Fleet management software and a Transportation Management System (TMS) can help optimize routes, improve efficiency, and reduce costs.
• Reduce Fuel Costs - Promote fuel-efficient operations for your fleet by investing in fuel-efficient equipment and employing practices to reduce fuel costs.
• Regular Maintenance - Perform regular maintenance checks on all fleet vehicles to ensure smooth operations and avoid downtime.
• Optimize Routes - Optimize your routes for fuel efficiency and travel time to reduce costs.
• Reduce Empty Miles - Empty miles are additional costs that can be mitigated by ensuring your trucks are always full and moving cargo.‍
• Retain Qualified Drivers - Qualified drivers can help your fleet remain efficient and reduce potential costs.

Trucking Cost Per Mile Calculators

There are a few different free trucking cost-per-mile calculators out there that are worth trying out. These include:

• ‍Motor Carrier HQ Calculator‍
• Truckers Report Calculator‍
• Rig Books Calculator

It’s worth noting that fleet management software is a superior way to calculate your cost per mile without having to lift a finger. Calculations are performed for every trip created and are available immediately to view, as well as many offering more advanced reporting options.

Trucking Cost Statistics

Trucking costs are always changing and vary by region — making it even more important for trucking companies to stay on top of cost per mile data. According to the American Transportation Research Institute (ATRI), the average trucking cost on a per-mile basis for logistics companies in the United States varies by region and is approximately $2.26 in 2024. The number we provided is an average of the cost per mile data for each region in the United States. To put it simply, if one of your fleet’s trucks drove 75,000 miles this year, then your company has spent a significant $169,500 to keep that specific truck in operation. It’s clear that each and every mile that you can reduce costs for will result in tangible savings for your business, which is why understanding your cost per mile and all of the factors that create it is so valuable.

The transportation industry continues to experience some major changes that are highlighted by American Transportation Research Institute (ATRI) data. Fuel costs increased by an estimated 53.7% in 2023 — which has a significant impact on operational costs. Data provided by the American Transportation Research Institute indicates that fuel costs were lower at the start of 2024 and are expected to rise in Fall 2024 and into the next year. The overall wages for qualified drivers across multiple sectors increased by 7.6% in 2023 with moderate increases predicted for 2024. Repair and maintenance costs rose by an estimated 3.1% in 2023 and companies have seen a moderate increase thus far in 2024.

READ MORE: What Is the ROI on Transportation Management Software?

Invest in Fleet Management Software

If you want to manage and monitor your fleet’s cost per mile and how much you’re investing into your fleet’s transportation capabilities, your best bet would be to invest in top-notch fleet management software. There are so many different things that fleet management software can offer a business, especially in an industry where so many logistics companies are still stuck in the dark ages with pen and paper tracking. Fleet management software can help organizations track the mileage and calculate a true cost per mile in the transportation and logistics industry through easy-to-use dashboards and reporting.

Contact TransPlus today to learn more about our fleet management software!