Weighing Options When You Need to Buy Parts

close up of diesel engine

There are plenty of risks to buying lowest-price parts, but buying the highest price part isn’t the answer either. What you really want is to find the sweet spot that’s right for your situation and your truck.

In Heavy Duty Trucking’s article, “Five Keys to Best Parts-Buying Practices,” Mark Terry, general manager, truck and bus at Yancey Bros. Co. (a Georgia-based dealer and parts supplier) explains that the cost-benefits analysis depends partly on how long you plan to keep the truck.

For “people who trade a truck every three to five years,” Terry says “it’s going to be original equipment parts wherever possible. But for owners of used trucks, the cost-benefits scale tips more toward all-makes. And, especially for someone who buys a truck and keeps it for 10 or 12 years, aftermarket parts exceed the price premium they would pay to the OEM or tier 1 suppler.”

Remanufactured vs. Rebuilt

Remanufactured parts are more expensive, but in the long run may be the better deal since they’ve been brought all the way back up to spec. Rebuilt parts are only reworked to running condition, usually aren’t covered by warranty, and may set you up for some unexpected breakdowns.

Parts that are remanufactured can be off brand or name brand. Name brand is generally less risky, but a reliable, trustworthy remanufacturer may be able to offer an off-brand part with the same reliability and better cost-effectiveness.

In “Part Smarts” on Overdriveonline.com, Rick Sullivan, a shop manager at Fleet Pride says his company offers discounted parts that differ from OEM only in that they don’t have parts numbers. “An owner-operator who’s in a cost-sensitive situation can go with quality, off-brand aftermarket parts that will save him 25 percent or even more and still be confident he has good parts that aren’t going to wear out faster,” he says.

In that same article, ArvinMeritor drivetrain products manager Sandy Landgren suggests owner operators, “look for remanufactured parts that meet QS9000 standard requirements.” Using parts that satisfy this industrial certification offers assurance that the part will perform well.

Buyer Beware

Both remanufactured and rebuilt parts have their risks. Rick Easterling, parts manager at Freightliner Trucks of South Florida in Riviera Beach says in this article, “it’s important to know exactly what you’re buying…If Eaton reman’s a clutch, they’ll throw out all the old springs and use new ones, but a guy selling will-fits might just put a flat washer under the old springs and call it reman’d.”

Easterling, who has 30 years’ experience in the truck parts business, also warns parts buyers to be on the lookout for “black paint reman’s.” A transmission, for example, may be freshly painted and look remanufactured, but it may have only been steam cleaned and had a few pieces changed. The seller may have replaced the outer bearings but hasn’t checked “the inner bearings and gear wear and clearance,” he says.

Brake shoes are sometimes called “remanufactured,” even though they aren’t truly brought back up to spec. John Thompson, sales manager, commercial vehicle NAFTA, at TMD Friction says if shoes haven’t been set in a die and pressed at very high tonnage, they can’t have been brought back to their original, factory shape. That misfit will mean you’re in for shorter brake life and more frequent maintenance.

“Some reliners only remove and replace lining,” he explains. “This is not the best starting place for a brake reline, as the high forces involve in braking will ‘stretch’ or distort the shoe in normal operating conditions.”

Cost Savings is Great, But Also Consider Value

In Heavy Duty Trucking, Meritor’s aftermarket business unit director for drivetrain, Aaron Bickford, says that lower-priced brake friction could seem like a deal, but premature wear will mean it has to be replaced more frequently, and “the parts and labor cost will quickly outrun any initial piece parts saving.”

Under spec’ing is probably not worth the savings either, says Sullivan: “If your brake linings are originally spec’d to 23,000 pounds, and you buy 20,000-pound linings to save money, you might have trouble.”

That sort of trouble from mixing and matching parts can be compounded on newer trucks that have electronic control panels. Unlike with older trucks, parts for more recent models require precision fit to avoid mismatches that can lead to breakdowns.

Working with a licensed parts dealer can prevent another problem: voiding your warranty. On Overdriveonline.com, Jim Lainio, a Ryder mechanic in south Florida, says, “If I put a bad-quality, off-brand turbo on a warranty engine, and a turbo blade comes apart, then I’ve got bits of turbo blade up around the pistons, and I’m out some big dollars for a new engine.”

Don’t Forget Core Value in Your Calculations

OEMs will usually grant significant discounts on a remanufactured part when you turn in the old part, according to Overdrive. In fact, David Schultz of Bendix Commercial Vehicle Systems says, “sometimes the core value is higher than the cost of remanufacture.”

Dealing With Unexpected Expenses

guy working on truck

Independent owner-operators have an enviable life in many ways, not least of which is being your own boss. But without the stability of regular paycheck it’s harder to be ready financially for the unexpected. And when you own your own truck, “the unexpected” can mean tens of thousands of dollars in repair costs and lost revenue.

And then there’s the expenses racked up thanks to severe weather or an accident. A slump in demand for your services takes a further toll on revenue. There’s no surefire way to prevent any of these crises from happening, but you can reduce the stress, the sleepless nights and the strain on your marriage by being prepared.

Stamp Out Debt

Eliminating as much debt as possible is your first step. Credit card debt is the worst. Interest rates on this kind of debt can go above 30%, much higher than for other kinds of secured debt, like truck and home loans. With such a high rate, paying down credit card debt is that much harder. As the interest compounds, you’re paying more and more interest and less and less of the principal.

Carrying debt on credit cards “keeps you poor,” according to consumer expert Clark Howard. With the high interest rate, you’re paying that much more for everything you buy on the card. It also siphons off cash that could go into savings. When an unexpected expense arrives, you have fewer resources to fall back on and are forced to put the charge on a credit card, perpetuating the vicious cycle of charging, delaying payment and accumulating debt that compounds at 30% per year.

Build Three Different Funds

Most people can get by with an emergency fund to cover three to six months of living expenses, but when your work requires a tool as expensive as a truck, you really need three funds: an emergency fund to cover motel and rental car in case you’re stranded by weather, breakdown or an accident; a truck fund to take care of unexpected repairs; and an income reserve fund to live off in case you have to endure a dry spell in your business.

Establish a goal for each fund and begin channeling any surplus you can spare to these funds, starting with the emergency fund. Research what it would cost to rent a car from the farthest point in your range and return it in your hometown. Overdrive magazine pegs the cost of maintaining a four-year-old truck at 12 cents per mile to give you an idea what to shoot for with your truck fund. Three months’ worth of living expenses is a good rule of thumb for your income reserve fund.

Considering that severe weather emergencies come with power outages that could make your credit card useless, keep a reasonable amount of cash on hand at all times. Also, make sure your credit card’s limit is high enough to cover expenses for getting home with all of your belongings in case you’re in an accident.

Finding the Funds to Do It

According to Mint.com, it’s more about finding the discipline to do it. Most people look at their checking account and conclude they can’t afford to save, but reducing expenditures and making saving a non-negotiable expense can make the funds mysteriously appear.

Being honest with yourself about the difference between wants and needs is key. Smartphones, cable TV, dinners out – anything beyond food, shelter and basic clothing is a want. Financial experts recommend you establish a goal for monthly savings and fulfill that before spending anything on wants.

Three Ways to Get the Maximum Miles Out of Your Tires

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Can you get 400,000+ miles out of your tires?

In Three Top Ways to Preserve Tire Life in the March 2014 issue of Heavy Duty Trucking, Jim Park writes about a retired maintenance specialist who accomplished this feat regularly.

Ron Szapacs, former maintenance specialist for Air Products and Chemicals, admits the goal is too ambitious for some applications but says in long-haul situations and in the service of maintenance-focused owner-operators, tires can get close to the half-million miles mark before being retired. He says there are three keys to making that happen:

1. Identity the Proper Inflation Level and Keep it There

Consult your manufacturer Load & Inflation tables to help determine precisely where your pressure should be. And it is important to settle on a precise number. The practice of over-inflating just a tad to boost gas mileage and hedge against tire damage, according to the experts interviewed in Parks’ article, does neither.

In fact, most tires function best inflated only to the L&I minimums, which allows tires to maintain a larger area of contact with the road and reduces impact damage. Herman Miller, president of HJM Fleet Maintenance, says higher pressure may produce some “small increase in fuel economy, but I could never quantify it.”

And tires that are at higher pressure “are too hard to function the way they were designed to function – that is, having enough give in the casing to absorb impacts like pot holes and road debris, having the optimum footprint or contact patch.” he says.

2. Maintain Alignment, Balance and Keep an Eye Out for Other Mechanical Threats

The way your tires are wearing can tell you a lot about your truck’s overall condition, Park explains in Extend Tire Life: Learn How to Tell When Your Trucks are Killing Your Tires.

Suspension, steering, wheel mounting studs, bearings, alignment, balance, shock absorbers – problems in all these areas will show up in tire wear.

The American Trucking Association’s “Radial Tire Wear Conditions and Causes: A Guide to Wear Pattern Analysis” offers detailed categories to identify wear and track back to possible causes.

One of the most common culprits is running a truck out of alignment, a problem that can cost up to a third or more of a tire’s life expectancy, according to Mike McCoy, national accounts sales manager at Beeline. “If you’re seeing irregular wear, don’t wait until the tires are destroyed. A $200 alignment could repay itself several times over in reduced steer and drive tire wear.”

Balancing is also as “maintenance tough sell,” according to Park, especially since with new tires it’s rarely a problem anymore. “But what about hubs and brake drums that might be out of balance, or worn hub pilots that could cause an out-of-round condition with wheel or tire?” he asks. Plus, a new tire that starts out balanced can be knocked out of balance in as little as a month.

He recommends dynamic balancing compounds or balancing rings to help maintain balance, even where wear is already irregular.

3. Retread

Important as proper inflation and maintenance are for extending the life of your tires, nothing beats retreading to maximize your tire investment. According to Modern Tire Dealer magazine, a retread is about $140 less than the average price of a new replacement tire.

And, Park points out, “when you factor in as many as two retreads on a single casing, you’re tripling the value of that casing – but effectively getting three times the mileage from it.”

Bill Sweatman, president and CEO of Marangoni Tread North America says that using modern retread technologies from initial to final inspection is key. He says it’s important to commit to using a system that “makes the retread decisions or you and your tires based on optimizing total cost of ownership.” Do those two things and he says post-retread performance can actually be superior to original new tire life.

Why Owner-Operators Need a Truck Maintenance Plan

guy working on truck

That truck you drive every day isn’t just a tool. It’s an asset that can make your business more successful if you treat it well. A regular oil change for example, removes iron particles from your engine. “Having iron particles in your oil is like having sandpaper in your engine: It’ll wear out parts quickly,” says engine repair shop owner Bruce Mallinson.

To Satisfy Regulations

If the idea of sandpaper on your engine parts isn’t enough to make you uncomfortable, the fact that the government can take you off the road if your maintenance isn’t done and documented may motivate you some more.

Getting your authority means you’re also getting a DOT number, which means you’re on the FMCSA’s radar for a new-entrant safety audit. Sometime between your sixth and eighteenth month of operation, you’ll be subject to a thorough once-over by the Feds, according to Thomas Bray, Editor, J.J. Keller & Associates.

In “How Safety Audits Apply to New Owner-Operators,” Bray explains that the audit includes a check of six factors, including driver(s), operational, hazardous materials, accidents, general – and vehicle. The vehicle factor requires that the carrier be able to show a program for systematic inspections, maintenance, and repairs, and records of annual inspection requirement compliance.

If you’re operating more than one truck, the auditor will also check your driver vehicle inspection reports (DVIRs) and will request inspection, maintenance, and repair records for every truck.

To Save Money and be a More Reliable Carrier for Your Customers

But if all you’re doing is satisfying regulations, you’re leaving a lot of money on the table, says Mel Kirk, vice president of maintenance operations for Ryder Systems. “You’re not running an effective preventive maintenance program if you see it only as an exercise mandated by the law,” Kirk says in this article on avoiding common maintenance mistakes. Maintenance should be seen as an exercise to assess the vehicle’s condition and resolve any issues before they create more expensive problems in the future.

The danger in putting off preventative maintenance is that it gets to be a habit, according to Bob Merrill, operation analyst for W.W. Williams. And every time it gets put off, the risk of breakdowns increase. Your maintenance plan should set standard intervals for component maintenance and include frequent checks so that breakdowns are eliminated. If you can do that, the program pays for itself, Merrill says.

Merrill’s sentiment is echoed in this article “How Much Should You Put Away for Maintenance?” by Bill McClusky, a 23-year veteran of the trucking industry. “Preventative maintenance can be expensive, but neglect is even more costly. Systematic PM saves you money in the long run by reducing the chances of equipment failure on the road and reducing time lost to repairs,” he says.

Again, “systematic” is a key concept and it’s easier to have the discipline to be systematic when you have funds available specifically for maintenance. The question then is how much to set aside to take care of your truck. McClusky recommends that for a new truck, you earmark five cents per mile. For older trucks, save more – a four-year-old truck or one with more than 600,000 miles needs 10 cents for every mile.

Once your maintenance costs reach the 13 or 14 cents per mile threshold, it’s probably a good time to look into investing in a new truck. Check out Team Run Smart’s “Upgrade vs Rebuild: When’s the Right Time to Invest in a New Truck?” to see a payment and maintenance cost analysis.

As another preventative tactic, establish an account with a truck rental company, which should reduce the time needed to get a substitute truck in case your truck needs major repairs. You’ll be able to keep your commitments to your customers, keep working and earning income, and reduce your stress level as well.

Are You Cut Out to Be an Owner-Operator?

semi in the front yard

Google “How to become an owner-operator,” and there’s plenty to discourage you from considering the question for long. 

Brett Aquilla, a former company driver, says “you have to be crazy” to take on buying your own truck and becoming a business owner. He advocates the employee route and letting your employer hassle with the financial strain, licensing, permits, breakdowns, insurance, etc.

“Kick back, earn $55K, and make a killer living viewing the sites across North America in your company’s dream machine,” he says. “And if you get tired of trucking – quit. A company driver can always just quit and return later at any time.”

Some drivers, though, have been down the employee road and haven’t found it to be the walk in the park Aquilla describes. Company drivers have their own hassles including company politics, power-tripping dispatchers, and having to haul loads and run lanes that don’t suit them.

And some are just more interested in having their independence and the sense of satisfaction that comes from succeeding on their own guts, wits and hard work.

If you’re thinking about it, here are some sources for the tough questions you’ll need to ask yourself.

Make Sure You’re Doing it for the Right Reasons

Small fleet owner and radio show host Kevin Rutherford says most people considering the move to being an owner-operator will list three reasons they want to do it: First, usually is “to make more money. Then it’s more ‘freedom’, ‘less hassle’, ‘fewer rules’. If your answers sound like these,” he says, “think again before you proceed,” because you’re likely to be disappointed.

According to Rutherford there are better reasons for taking on the additional work and away-from-home hours. Drivers who transition successfully to owner-operators are usually those who do so because they want the additional responsibility and challenges of being a business owner, and want to build a business that will support better lives for them and their families. Read the list of questions Rutherford suggests you ask yourself to further test your assumptions about being an owner-operator.

It’s a Whole Lot More than “Steering and Gearing”

Truckie D is an owner-operator with 1 million+ consecutive safe over-the-road miles who blogs at TruckieD.wordpress.com. His advice, if you haven’t driven a truck before, is first to slow the heck down and get hired somewhere first, drive for a year and then see if you’re still in love with the idea of being an owner-operator.

“But”, he says, “do NOT get sucked into getting trained and buying/leasing a truck immediately. That’s a recipe for going broke quickly. Trucking as an owner-operator is a whole lot more than just ‘steering and gearing.’ The important point to remember is, you’re not buying a truck — you’re buying a business. You need experience in the trucking business, and some general business experience if you want to be successful at it.” Being able to understand a profit and loss statement and understanding how to do a cost benefit analysis of say, adding an APU to your truck, are just a couple of the business skills you’ll need to master.

See his blog post, “So, You Want to Be an Owner Operator,” for more some more sobering reality checks about owning your own truck driving business.

If You’re Still Not Scared Off…

Samuel Barradas readers through 6 steps to becoming an owner-operator on The Trucker’s Report blog. First, is a personal assessment – how much time you need at home, health considerations, career goals, etc. Next is a list of financial considerations to mull: the risks of personal debt, establishing an emergency fund and whether your credit score is going to help or hurt you. He also addresses the questions of whether to go independent or lease to a company, what types of equipment to shop and run, and what legal and accounting structures you should have in place.

Increase Your Odds of Succeeding

According to the National Assoc. of Small Trucking Cos (NASTC), the failure rate of small, start-up trucking companies is about 85%. Only 15% make it to the second year of operation. The organization offers training to help aspiring fleet owners beat the odds. On their website you can find more info about their training.

On that page you can also find a list of 20 new authority concerns, just the tip of the iceberg as far as the kind of business planning you’ll need to do: How do you plan to find freight? Where do you plan to run? How will you find insurance? How are you going to keep the books? How are you going to do log audits, fuel taxes, and driver qualification files? How are you going to manage and interpret data and information?

Lots to think about, but looking at it all before you leap will save you a lot of stress, debt and disappointment.