What is cost per kilometre and how should a fleet use it?
Cost per kilometre is the total running cost of a vehicle or fleet in a period divided by kilometres driven. Include fuel, driver cost, maintenance, tyres, insurance, finance or depreciation, and tolls, not just fuel.
It matters as a baseline for quoting and for spotting vehicles that cost more than similar ones.
Commonly misread:
- Using only variable costs, which understates the cost of idle or low-mileage vehicles.
- Comparing different vehicle types.
- Treating a falling cost per km as success when the fleet is simply driving further with empty loads.
Read it with cost per drop and revenue per kilometre. If cost per km is low but cost per drop is high, vehicles may be travelling long distances for few deliveries.
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