1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
29
30
31
32
33
34
35
36
37
38
39
40
41
42
43
44
45
46
47
48
49
50
51
52
53
54
55
56
57
58
59
60
61
62
63
64
65
66
67
68
69
70
71
72
73
74
75
76
77
78
79
80
81
82
83
84
85
86
87
88
89
90
91
92
93
94
95
96
97
98
99
100
101
102
103
104
105
106
107
108
109
110
111
112
113
114
115
116
117
118
119
120
121
122
123
124
125
126
127
128
129
130
131
132
133
134
135
136
137
138
139
140
141
142
143
144
145
146
147
148
149
150
151
152
153
154
155
156
157
158
159
160
161
162
163
164
165
166
167
168
169
170
171
172
173
174
175
176
177
178
179
180
181
182
183
184
185
186
187
188
189
190
191
192
193
194
195
196
197
198
199
200
201
202
203
204
205
206
207
208
209
210
211
212
213
214
215
216
217
218
219
220
221
222
223
224
225
226
227
228 
NEW VEHICLES
Page 172
Page 175
If you've noticed an error in this article please click here to report it so we can fix it.
NEW THINKING on Costs THE increase in the range of 'vehicles to be displayed at the Commercial Motor Show, which opens next Friday, demands a reappraisal of costing if full advantage is to be taken of current developments in design. Last week I compared the operating costs of the popular 'Mon oiler and a six-wheeled conversion of a similar chassis, showing that the larger vehicle was an economic proposition when a bigger rigid was required.
Because of the infinite variety in traffic requirements, however, many operators are faced with the need for a vehicle slightly larger than the popular 74onner, whilst still retaining the manceuvrability of the four-wheeler. Previously there has been a wide difference in both the types and costs of goods vehicles of 7-ton capacity and those above that size. Now the gap has been reduced. Vehicles of 7i-.-ton capacity have been introduced, whilst the abolition of purchase tax on goods-vehicle chassis last year substantially reduced the initial outlay required for specialist-built 8-tonners. .
It is, therefore, opportune to review the operating costs of 7-, 71and 8-ton four-wheelers, all of which will be assumed to have oil engines. To allow for differing replacement policies, dependent upon individual working condition, three variations in estimated depreciation costs will be included.
To facilitate ready comparison, the costs for all three vehicles will be calculated on the assumption that alt maintain an average weekly mileage of 800. For this reason the items of cost in respect of the 7-tormer will vary slightly from those given last week for the corresponding vehicle, when the assumed average weekly mileage was 900. The 7-ton oiler will have an unladen weight of around 3 tons 4 cwt., and an annual licence duty of £38 15s., or 15s. 6d. per week. Drivers' wages are reckoned at £9 us. 6d., including allowances for insurance contributions and holidays with pay. Rent and rates for garage are estimated to add 11 s. 9d., whilst the annual insurance premium costs £42, or 16s. 10d. per week.
Assuming the outlay for this platform-bodied vehicle to be £1,300, interest charged at a nominal rate of 3 per cent would amount to 15s. 7d. per week. The total for these five items of standing cost is £12 I Is. 2d., and, assuming an average of 800 miles per week, the cost per mile becomes 3.77d.
With oil fuel purchased in bulk at 3s. 10d. per gallon and a consumption rate of 15 m.p.g., fuel cost per mile would be 3.12d. Lubricants are reckoned at 0.25d. A set of 8.25-20-in. (12-ply) tyres would cdst £186. With a life per set of 30,000 miles, tyre cost per mile would be 1.49d. Maintenance will be reckoned at 2.18d. per mile.
In the first instance it will be assumed that the 7-winner will he replaced after 150,000 miles. To obtain the amount to be written off, the cost of the initial set of tyres will first be deducted from the price of the vehicle, followed by a further deduction equivalent to the estimated residual value. The balance of £952 results in a depreciation cost per mile of 1.54d.
Total running cost per mile is 8.58d., which, when added to the standing cost, gives a total operating cost of 12.35d. The corresponding running cost per week, when averaging 800 miles per week, would be £28 12s. and the total operating cost £41 3s. 2d.
As an alternative replacement policy, it will now be assumed that the vehicle life is reduced to 125,000 miles. Adopting the same procedure as before, the depreciation cost per mile is increased to 1.83d., giving a running cost per mile of 8.87d. and a total operating cost per mile of 12.64d. The corresponding running cost per week would be £29 Its, 4d., whilst the operating cost would be increased to £42 2s. 6d.
Now suppose the life is increased to 175,000 miles. At this figure the depreciation cost per mile would be decreased to 1.31d., making the running cost 8.35d. and operating cost 12,12d. per mile. The total cost of operating the 7-tonner 800 miles per week would then be £40 7s. 10d. This substantial reduction on the previous two totals indicates the importance of depreciation on total operating costs.
The 7+-tonner, with platform body, will be assumed to have an unladen weight of 3+ tons and an annual licence duty of £42 10s. (I7s. a week). Wages will remain at £9 Ils. 6c1., as will rent and rates at us. 9d. per week.
Because of an increase in both the carrying capacity and initial outlay, the annual insurance premium will amount to £46, or 18s. 5d. per week. On a vehicle costing £1,650 the interest charge will be 19s. 9d. per week.
The total of these five items of standing cost will be £12 18s. 5d., or 3.88d. per mile, still assuming an average of 800 miles per week.
With oil fuel bought at 3s. 10d. a gallon and the consumption rate increased to 14 m.p.g., fuel cost per mile becomes 3.34d. Lubricants are reckoned fractionally higher at 0.26d. To accommodate the additional loading, 14-ply tyres will be used, increasing the cost per set to £202, The corresponding tyre cost per mile is therefore 1.62d. Maintenance is reckoned at 2.23d. per mile.
Deduction of both the cost of the initial set of tyres and ultimate residual value leaves a balance of £1,262 to be written off, giving a depreciation cost per mile of 2.02d. on a 150,000mile life. Total running costs are 9.47d. and the total operating cost 13.35d. per mile. The total running cost per week would be £31 I Is. 4d., which, when added to the weekly standing cost of £12 18s. 5d., gives a total operating cost per week of £44 9s. 9d.
If the 74-tonner is replaced at 125,000 miles, the depreciation cost per mile becomes 2.42d, Running costs total 9.87d. and operating costs 13.75d. per mile. The equivalent running cost per week would be £32 18s. and operating cost £45 16s. 5d.
If a vehicle life of 175,000 miles were obtained, the depreciation cost per mile would be 1.73d. with a correspondingly reduced running cost of 9.18d. and an operating cost of 13.06d. per mile. This gives a running cost per week of .£30 12s., whilst the total cost of operating 800 miles
per week is £43 10s. 5d.-£2 6s. per week less than when the vehicle is replaced at 125,000 miles.
The example chosen for the 8-tonner is one of the lighter vehicles in the" quality" class. With an unladen weight of 3 tons 13 cwt., the annual licence duty will be increased to £46 5s. and the cost per week to 18s. 6d. Wages will remain at £9 1 Is. 6d. and rent and rates at us. 9d. per week. The annual insurance premium is raised to £51 4s., or £1 Os. 5d. per week. It will be assumed that with a platform body the vehicle costs £2,150, resulting in an interest charge per week of £1 Ss. 9d. Standing costs per week are, therefore, £13 7s. 11d., giving a corresponding cost per mile of 4.02d.
With a fuel-consumption rate of 13 m.p.g., fuel costs per mile become 3.60d., whilst lubricants are again reckoned at 0.26d. A set of 9.00-20-in. (12-ply) tyres would cost £212, and, still assuming a mileage life of 30,000, tyre cost per mile would he 1.70d. Maintenance is reckoned a little higher at 2.2911. per mild.
Because of the higher initial outlay for this type of vehicle, the balance remaining to be written off rises to £1,670. For the same reason, however, a higher mileage life could reasonably be expected. This will first be assumed to be 250,000 miles, resulting in a depreciation cost per mile of 1.60d. Running costs become 9.4511. and operating costs 13.47d. per mile. Running costs per week are £31 10s. and total operating costs £44 17s. lid.
Decreasing the vehicle life to 200,000 miles would increase the depreciation cost per mile to 2d., whilst the running cost would become 9.85d. and operating cost 13.87d. per mile.
If 300,000 miles were covered before the vehicle had to be replaced, the depreciation cost per mile would be reduced to 1.33d. Correspondingly, the running cost would drop to 9.1811. and the total operating cost to 13.20d. per mile. Total running cost per week would be £30 12s. and the total operating cost £43 19s. lid.
To compare the costs per ton, it wil be assumed that all three vehicles complete three outward trips per week fully loaded and return half loaded. With depreciation calculated at the intermediate mileage life in each case, the costs per ton would be: 7-tonner, 26s. lid.; 7+-tonner, 26s. 41(1., and 8-tonner.
24s. 1 lid. S.B.