Solving the Problems of the Carrier
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The Cost of Efficient Maintenance
Many Operators Fail to Record the Full Cost of Maintaining Their Vehicles: This Article is Intended to Direct Their Attention to ihis Most Important Item of Operating Costs OF all the items of operating costs, that of maintenance is the most difficult to assess. The figures in " The Commercial Motor" Tables of Operating Costs are, as is well known, based on averages, the basic data are collecttsd week in week out throughout the year, sifted and assessed as to their true value and a mean taken.
Whenever opportunity presents itself I obtain actual figures of costs from my many haulier friends. In nearly every case, the amount debited against maintenance is,
obviously, insufficient. On the rare occasions when the amount debited is what I would regard as ample for the purpose there is an apojpgetic murmur from the operator that such-and-such a lorry was down for overhaul that week, or that month, as the case may be, and that I should not regard the figure as truly representative.
That observation at once indicates that the operator concerned does not realize what is meant by the term " maintenance," which is intended to cover expenditure on major overhauls, as well as minor attentions to the chassis and bodywork of the vehicle.
, Then there is that type of operator who neglects to enter small items of expenditure as being too insignificant, forgetting the old Scottish proverb, that "many a mickle makes a muckle." Actually, the cost of maintenance, apart from the expensive items, such as major overhauls and the like, is made up of small amounts. Indeed, I can demonstrate by a simple example that the seeming small amounts often mean more, in cost per unit, than the. large ones.
Take the case of a vehicle on which the sum of 10s.
per week is spent in washing, polishing, etc. The mileage is 240 per week, no more. The cost per mile is thus one halfpenny. When the vehicle has covered a total mileage of 100,000, it is taken apart and thoroughly overhauled, at a cost of £100. That is less than one farthing per mile. Every penny must be recorded, and eyen then, as I 'shall show, the statement in the majority of cases is incomplete, falling short in some other. respects.
The sort of thing that does exasperate me beyond measure IS a letter to a vehicle manufacturer from an operator stating that the machine has run a colossal mileage and cost only the price of a couple of split pins for maintenance. • If I were a manufacturer and received such a letter I should not, as so many do, treat it as a testimonial and advertise it. I should cancel the guarantee relating to the vehicle on the ground that it had been grossly neglected—or tell the operator to think again.
A v.ehicle must, inevitably, begin to involve its operator in expenditure on niaintenance-so soon as it is put into service. If 'there be no such debit the vehitle is beingneglected and, although the amount spent on main tenance is not necessarily an indication of the efficiency of that work, I should, when the amount is small, expect to find that one of two things is happening._ Either the operator s omitting to enter arthat is spent' on it, or he is neglecting the machine.
In the majority of cases it is the former, for, no oneis fool enough
seriously to neglect the tool..wherebY his business • is carried on. The
principal reason, why maintenance costs records are faulty is that so many operators haVe the work done by drivers, or in a repaif .5hop, the cost of which is debited against overhauls. All these operators opine that my figures (in "The Tables ") are excessive. They entirely overlook the fact that they are paying as much, or more, than I say in maintenance costs, but are not debiting it, as they should, against that item.
It will help, at this juncture, to refer to the current issue of "The Commercial Motor" Tables of Operating Costs. dated 1942. In that, as in several preceding editions, I have split maintenance costs into two portions: one is called " Maintenance (d)," the other "Maintenance (e)."
The expenditure under Maintenance (d) is inteaded to cover what may be called routine maintenance operations, more specifically to be defined as those operations which•are carried out periodically on a time basis, irrespective of mileage. Such operations are washing, greasing, repainting. varnishing and similar work.
It is. difficult enough, using averages, to cover all possible variations which may occur in expenditure under this head. Atthe one extreme, there is the type of operator who may, or may not, wash his vehicles, once per month and who never has them repainted or varnished from the time he puts them into service until he disposes of them, in a sadly dilapidated condition, in part exchange for new ones.
On the other hand, there is the operator who has his vehicles washed daily, revarnishes them once a year, and has them 'repainted and lettered in alternate years. The other half of this item, Maintenance (e), relates to expenditure on repairs and overhauls, operations which are necessary, not at intervals measured by time, but by mileage.
The importance of this' classification, and its bearing on any, estimate of average costs, lies' in. the'slistinction mentioned, that Maintenance (d) operations ai'e carried out at intervals of lithe and those of Maintenance (e) on mileage.
If the frequency of an operation is determined by. time, then, as maintenance costs are assessed " per mile," those costs must increase in inverse proportion to the annual mileage. If the cost per week be 10s., and the weekly mileage is 240, the cost per mile is one halfpenny, but if the weekly mileage be 480, that cost is reduced to one farthing per. mile. Refer also, in this connection, to Table VII, and examine the amounts quoted relating to a maximum-load sixwheeler. At 200 miles per week the-cost is 1.26d. per mile; at 400 miles per week it is 0.63d. per mile and at 800 miles per week it is 0.32d. per mile. Maintenance (e) is Lad. per mile for all mileages.
The second figure IS an average, of actual costs, increased by a percentage to cover more recent increases in costs of .materials and labour, as well as the expense of obtaining spares and tfie cost of the extra delay—the time involved in effecting the repair—due to difficulty in getting the necessary spares.
For the former figure, Maintenance (d), an estimate has to be made, somewhat on the following line. For washing, greasing, topping-up batteries, and a host of other routine maintenance operations, I allow, in a vehicle of that size. 12s. 6d. per week.
For the painting and _varnishing, in alternate 'years, somewhere between £40 and £45—present-day prices. That works out at 8s. 6d. per week, so that the total is Is. per week. Divide that amount by 200 (for 200 miles per week) and we get 1.26d. per month, falling, as above described, as the wkly mileage increases
Now the operatotr who has this routine work performed by his driversis probably aware of the fact that his main, tenance, performed in that ;iray, costs him.something. So far as his total. costa are concerned, of course, there is nothing omitted, and 'if his costs records be complete in every detail he is in a position properly to assess his rates, and charges on the basis of cost plus profit.
If he imagines that, by having the work done in this way. he is saving expense, he is in error. Most drivers of these heavy vehicles, which arc almost entirely confined in their use to trunk services, work approximately 60 hours. per • • week. The hours they spend On this work of maintaining their vehicles must be paid for, therefore, at time-and-aquarter, say, 2s. 3c1.. per hour.
If four hours per week be devoted to the work, that is 93., add sundry materials and allowances for overheads and the total of 12s. 6d. is quickly passed. The allowance of 8s. 6d. for painting and varnishing still stands, Of course.
It still remains that the amount debited against maintenance in the operator's books is actually inadequate, anti I have the greatest difficulty in persuading hauliers that that is•so.
So far as the average three-to-five-vehicle operator is concerned it is improbable that any improvement in costing methodS, to, correct this error, will take place. In larger concerns it would be .better if drivers, when engaged on maintenance work, entered details of that work on time cards. In that way mare accurate figures for maintenance would be,obtained.
In effect, so far .as the average haulier is concerned, he will be wise, provided he does keep adequate costs records, to rely upon "The Commercial Motor" Tables of Operating Costs as a basis for calculating his charges, using his own figures for an annual or six.monthly check. S.T.R.