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WHATEVER BRAND OF PETROL YOU S
some, also, employed on service which is favourable to lornic operation, such asirearrying loads over long ances on good roads."
Yes," he answered, "I quite see that. . I realize that r figures are averages and that my machine might fairly expected to be over, rather than under, the average so as cost per mile goes, but what I don't understand is v comes it to be that some of my figures, like those for and oil, are higher than those given in the Tables, 1st those for others—tyres, for example—are less."
The explanation is not a simple one," I answered; "but vorth discussion for all that." I picked up his statement running costs. " First of all I need not refer to the tres for fuel and oil consumption, I have already dealt h those but, in passing would point out that yours is an machine and it is notorious that old vehicles are ariahly heavy on those two items. Next tyres, There a special reason for your showing such good results respect of expenditure on that item. According to the ire you gave me, you bought at a special price and, a st unusual occurrence with tyres, you got a bargain. u may pay more next time and not get anything like such id service.
The figures for maintenance agree exactly with those the Tables, but that is really only supposition, the truth that you don't know what your own maintenance costs . That is a mark against you. And finally, of course, ire is that most difficult of items, depreciation.' We Ily have something to talk about there. I am going to ist that depreciation should, in your case, be calculated time and not mileage. I shall take five years," That is surely a big change," he objected. "I thought Lt depreciation was always to be calculated in miles; it tainly is so treated in the 'Tables." Quite so, but yours is not an average vehicle, or at least is not so far as the work it is doing is concerned."
Decent Treatment ' don't see how that term can apply in this sense," he d. "Surely if it is given decent treatment, which you ve admitted in my case to be so, it should run the erage number of miles, and in that way qualify for the plication of the average in so far as the figures for preciation are concerned."
"In. that connection," I said, "the annual mileage is an [portant factor, and the mileage of this vehicle is very "But how on earth can that make any difference?" he. ked in an exasperated tone. "Surely the old bus will run 186,000 miles, or what is the appropriate figure, before it ast go on the scrap heap?"
"It can be .made to run for two or three times that stance," I replied. "Indeed, there. is no positive limit to e mileage that a motor vehicle will run. There is, however, limit to the mileage that it will economically cover."
"How does the question of economy come into it? If Veep .down the maintenance costs, as I do by carrying out e maintenance myself, I should be able to make the lorry St twice as long, and in that way save Id. per mile in ;preciation costs. I'm afraid I don't quite see your point."
"In the old days that might have served, but it won't 3 now," I said. "There have been advances in design and instruction of vehicles which mean that the new models ill be more adapted to economical operation than those hich have gone before.
"The old days, involving the programme you have just cetched, coddling a vehicle until it must be sold and is ;ally scrap when that happens, are gone and for good, I ope. And when I refer to the old days' I don't mean 1st pre-war. I'm going back a matter of five or six years nly. Commercial vehicle design before that did not change nich. The manufacturers were busy with other things.
'he machines did not vary a great deal from one year to the ext: it was certainly sufficiently accurate to measure epreciation without being concerned about the time it took .cover that mileage. Nowadays a little more discretion rust he exercised. Do you see the point?"
" Not yet," he replied. "I can't for the life of me see what changes in design have to do with the working life of my old lorry," he said. "Surely it will last as long no matter how many new types _come on to the market." .
I rejoined: "You've entirely missed the point. You can run a lorry like.yours for thousands of miles as -a hobby; perhaps you have become attached to the dear old thing; but you cannot run it so far in business, in competition with others who have up-to-date machines with which they could not only run you .off your road but which are much cheaper to operate. .
"Suppose," I said, "for the sake of argument, a competitor of yours had an up-to-date machine, with a good engine, large tyres, and a speed about 25 per cent. more than yours. Suppose that as the result of his higher speed he can manage one more journey per day. In that case he can do 30 loads per week and carry 150 tons and, even if his running cost per mile is no less than the average—and there are grounds for believing that the opposite is more likely to be the case—the extra cost due to the extra journey per day will be 6s, per day (six miles at Is. per mile) or 30s. per week.
Not Rate-cutting
"Whilst, therefore, your cost per week for 25 loads remains at £25 14s. 10d, for 125 tons, or 45. I id. per ton, he carries 150 tons for f27 4s. 10d„ which is equivalent to only 3s. 14c1. per ton. What your competitor does about that extra bonus is, of course, his business, but what I must guard you from is the risk that you might put in a plea that he is cutting a rate if he gives all or any of that benefit to his customer. It is not rate-cutting, it is the outcome of the possession of a new and better vehicle.
"The point is that as commercial vehicles advance in developments which go towards improved economy, so your old machine falls farther behind in the struggle and your losses steadily increase until you have no assets and no cash with which to buy a new vehicle."
"Then how do you account for such advertisements as are occasionally to be seen in The Commercial Motor in which it is stated that a vehicle, made by the advertiser and operated by a large operator, has covered an enormous number of miles and is still in use?" he asked.
"That can easily be explained," I replied. "The user who appears to be so fortunate with his vehicle has a large fleet employed on many different types of work. For some of the work they do there will be keen competition: they will have to make the most efficient use of the latest and best types of chassis in order to be able to meet that competition and retain their contracts at profitable rates.
Perfectly Satisfactory
"A good deal of the work they do, however, is routine and not subject to competition of any moment. For that an old, slow or obsolete machine is perfectly satisfactory; that fact, and the facilities they have for carrying on their own maintenance at small cost, justifies them in retaining these old machines for more years than is possible in the case of the owner of a half a dozen vehicles."
"I still don't see why." • "It's a matter of expediency," I replied. "The owner of a comparatively small fleet must be prepared at any time to turn any one of his vehicles to use in any of the various classes of work in which he is interested or is in the habit of accepting. He cannot conveniently arrange his work so that each vehicle is set apart for a particular type of work. The same problem arises, of course, in the case of the big operator, but his resources are so large and his vehicles so many and varied, that he can confine the use of particular vehicles to certain classes of work, using old machines on short trips and for traffic of comparatively little consequence, and retaining the better vehicles for the better-class traffics.
"You can see the same principles of operation if you take a note of the procedure followed by the large bus companies. On routes where there is competition, where only the best service will gain and hold the traffic, the latest and best buses are used: where there is no competition the older types of vehicleS are satisfactorily employed."