Fleet capacity utilization is the measure of how effectively a carrier uses its fleet (trucks, trailers, and employees) to transport goods. It’s the proportion of the fleet’s total capacity that’s actually being used over a specific period.
A low utilization rate means carriers are leaving money on the table, and fleet managers need to figure out how to improve it. This post explains factors that impact fleet capacity utilization and best practices for getting utilization back on course and improving load margins.
Industry Benchmarks for Fleet Capacity Utilization
The basic formula for calculating fleet capacity utilization percentage is:
(%) = (Actual Miles Driven or Load Hauled / Total Available Capacity) × 100
The total available capacity might be based on:
- Total number of trucks
- Total number of driver hours available
- Maximum possible loaded miles
- Volume or weight capacity
A 100% fleet utilization rate is uncommon, because trucks need maintenance and planned downtime. In general, industry benchmarks for capacity utilization rates are:
- Good (85%-100%) — Fleets are operating at peak efficiency.
- Acceptable (70%-84%) — Fleets could improve efficiency.
- Low (below 70%) — Fleets are losing money due to inefficiency or poor processes.
Factors That Impact Fleet Capacity Utilization
Common causes of low fleet capacity utilization include:
- Truck maintenance and repairs: If a vehicle is in the shop, it’s not generating revenue.
- Driver shortages: Inadequate staffing and unplanned absences create gaps in coverage.
- Hours-of-service requirements: Required rest breaks can disrupt delivery timelines.
- Market demands: Low demand correlates with low capacity utilization.
- Deadhead miles: Empty backhauls lower utilization.
- Types of loads: LTL and multi-modal loads can be more complex to schedule and manage, lowering efficiency.
How to Improve Fleet Capacity Utilization
Often, low capacity utilization occurs due to a combination of factors, so fleet managers need to look at every aspect of fleet operations to identify inefficiencies. That’s a monumental task, but it’s a lot easier with a transportation management system (TMS).
With a TMS, fleet managers can:
Automate Maintenance Scheduling
A TMS tracks all fleet vehicles and automates maintenance scheduling and service reminders. With GPS and telematics integration, a TMS captures vehicle data in real time to flag potential mechanical issues and upcoming repair needs to prevent unplanned downtime.
Simplify Driver Management
How many drivers do you need to ensure maximum capacity utilization? That’s a difficult question to answer without data. But a TMS can reveal whether you have a healthy ratio of drivers to loads.
A TMS can forecast periods of high demand, giving fleet managers time to find independent drivers for short-term needs. You can also anticipate low demand and encourage drivers to schedule time off during those periods.
With a TMS tracking hours-of-service in real time, you never have to worry about HOS compliance violations. You can also see when drivers are routinely bumping up against HOS limits — a sign that you need to hire more people to prevent burnout and retain your best drivers.
Optimize Load Management
Avoid deadhead miles and maximize LTL capacity with TMS load optimization features. Dispatchers don’t need to pivot back and forth between multiple systems, because a TMS lets them easily match load sizes and types with the right trucks and best drivers.
Get Detailed Insights
A TMS replaces paper records and messy spreadsheets, bringing all fleet data into a centralized platform. In just a few steps, you can:
- Create reports for your high-value KPIs
- Identify mechanical and operational efficiencies
- Generate profit and loss reports by load, truck, or driver
- Produce detailed audit-ready maintenance and HOS logs
- Forecast profitability based on clean data (instead of gut instinct)
Ready to Increase Your Load Margins?
PCS TMS for Carriers is the all-in-one solution for managing fleet operations. Whether you’re trying to improve fleet capacity utilization or improve customer satisfaction, PCS can help.
Find out how PCS customers increase load margins by 5-8%, accelerate cash flow, and grow their fleets. Contact PCS today to get your personalized demo.
