Fleet Leasing

Tyre bills rack up SMR costs

Longer service intervals and a trend for motor manufacturers to move the requirement for ‘expensive’ parts replacement - such as cambelts - beyond 60,000 miles has contributed to a decade long changes in the breakdown of service maintenance and repair (SMR) costs.

Data from Fleet Influence, reveals that across a basket of petrol and diesel models and a range of age and mileage profiles - three-years/36,000 miles, three-years/60,000 miles and four-years/80,000 miles - average service costs have reduced, tyre costs have risen and repair costs, largely the replacement of friction items such as brake pads and discs have, ignoring inflation, changed little (see charts below).

Meanwhile, data from Derwent Management Services reveals that across its complete vehicle database the big shift in SMR costs has been from service to tyres.

At three-years/60,000 miles tyres now account for an average 41% of SMR costs compared with 37% five years ago with servicing costs at 34% today compared with 37% five years ago.

The breakdown of SMR costs also reveals that brake part replacement remains unchanged at 20%, while there has been a slight 1% saving in ‘other’ costs defined as items such as wiper blades and timing belt.

Move to four years/80,000 miles and Derwent Management Services says the breakdown of SMR costs is almost identical today versus five years ago with tyres accounting for 38% of maintenance spend, servicing 34%, brakes 19% and ‘others’ 9%.

Above 100,000 miles the cost of ‘other’ items would almost certainly increase, according to Steve Chambers, research director of Derwent Management Services with items such as clutches, diesel particulate filters, exhausts and starter motors all requiring attention and leasing companies building contingency funds to cover other unforeseen failures and replacements.

Underlining the trend for manufacturers to extend component replacement cycles, Andy Smith, business development Manager at Derwent Management Services, said: “For example, Volkswagen used to change the Golf cambelt at 55,000 miles but then moved the change to 70,000 miles. Due to the labour involved (approx 3.5 hours) plus parts the cost could be £350-£400. However, with the expenditure now moved to 70,000 miles the SMR budget is very different on a 60,000-mile lease

“Leasing companies must be aware of what actions the manufacturers are taking to move maintenance costs from one mileage criteria to another.”


 



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