Special Report: True cost of ownership

Special Report: True cost of ownership

Comparisons of engine costs point to the value of replacing vehicles with the industry's latest models and technologies.

Since the first major diesel engine emissions regulations took effect in the 2007 model year, fleets across a wide range of industry segments have experienced differences in costs associated with each new round of technologies.

Quantitative data on groups of private and for-hire fleet vehicles paint a clear picture of the cost of ownership between pre-diesel particulate filter (DPF)-equipped, and selective catalytic reduction (SCR) engines (See charts on the right).

Trends
Comparisons of cost variances for different engine technologies indicate that the per mile costs of vehicles with SCR engines based on actual experience—and estimated in later years of service—are equal to pre-DPF technology and lower than DPF-equipped engines.

While these costs only reflect engine-related maintenance and repair expenses (total CPM for these vehicles across the board is two to four times higher depending on year of service), there also are indications that the cost per mile on DPF-equipped engines would have actually been higher in early years if warranty coverage had not captured much of the expense.

Higher cost issues identified include that regular forced and passive regeneration cycles in DPF-equipped engines can require that the filters be replaced three times over an eight-year life cycle at an estimated cost of $4,300 per replacement. In SCR systems, fewer re-gens are required, so the DPF is not subject to the same heat cycles and will likely not need replacement as frequently.

Systems on DPF-equipped engines increased heat transfer and caused early and repetitive exhaust gas recirculation (EGR) failures. The cost every 250,000 to 300,000 miles over an eight-year life is estimated at $2,100 per replacement.

Coolant leaks in EGR-equipped engines result in contaminated exhaust, which destroys the DPF catalyst. Estimated costs include $800 to clean the DPF and as much as $7,000 for replacement, depending on engine make and model.

Fuel injectors in DPF-equipped engines are key to eliminating soot. As injector tolerances change, not only are repetitive forced regenerations triggered, injectors must be replaced to control proper fuel delivery at an estimated cost of $1,200 each.

Other cost factors include driver downtime because of frequent parked regeneration, while parked re-gen is nearly eliminated in SCR engines.

Summing it up
SCR engine technology not only appears to be operating at favorable maintenance and repair cost levels in the newest engines, but also is more fuel-efficient. Not indicated in this data is that the latest engines are experiencing 3% to 4% better fuel efficiency than previous models, and while fuel consumption deteriorates at a rate of 2% to 4% because of more frequent regeneration cycles (depending on the application), less frequent regeneration is credited with less than half of that improvement.

The data speaks for itself. It is very likely that replacing trucks sooner, despite the higher initial price of newer models, might be more advantageous in the long run.

Resources
Experts in vehicle specification, purchasing, financing, maintenance and operational cost analysis are available to help fleets make more informed and effective decisions.

DWS Fleet Management Services: Providing services to all sizes of fleets, DWS Fleet Management Services supplements a company’s leadership capabilities on a limited time basis with expertise in organization, purchasing, lease evaluation, vehicle specification and maintenance management, including shop systems analysis and cost control initiatives.

DWS programs are tailored for each individual operation. The company’s approach employs a mixture of results-oriented problem solving and hands-on common sense to help achieve maximum profits, cost reduction and customer satisfaction.

With DWS Fleet Management Services, 37 years of experience is available for each fleet to negotiate effectively for vehicles, maintenance software, accounting and operational packages, as well as business and labor contracts.

Fleet Advantage: Fleet Advantage has a unique value proposition: Big Data analytics that monitor per-vehicle mileage, fuel economy, maintenance and repair costs, current resale and replacement value and monthly utilization and driver scorecards. 

What makes this unique is the company’s flexible lease, which allows a customer to replace equipment at any time, for example, when the data indicates that a truck has reached its “sweet spot,” that moment when new equipment offers a lower cost than retaining the current vehicle. 

Since 2011, manufacturers have improved MPG by 2% to 3% a year. Recent government mandates require a 2% to 3% improvement through 2018, so three years into a lease, a new truck would get .5 MPG improvement and save a fleet customer $5,000 per year.

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