Tips for Managing Fuel Costs in Over the Road Shipping
Fuel costs are one of the largest and most unpredictable expenses in over-the-road (OTR) shipping. For many carriers, fuel accounts for more than 30% of operating expenses, and fluctuations in diesel prices can quickly erode margins. Shippers, too, feel the impact through rising freight rates, surcharges, and supply chain uncertainty.
With fuel prices heavily influenced by global oil markets, refinery capacity, and even geopolitical tensions, complete control is impossible. However, logistics professionals can take meaningful steps to minimize fuel consumption, improve efficiency, and protect profitability. In this article, we’ll explore practical tips for managing fuel costs in OTR shipping, along with how partnering with experts like Welcome Logistics can make a measurable difference.
Why Fuel Costs Are a Major Challenge in OTR Shipping
Fuel volatility has long been a concern in freight transportation, but today’s market presents unique challenges:
Global Energy Demand: Rapid industrial growth, particularly in emerging markets, affects global oil demand and pushes up prices.
Refinery and Supply Chain Disruptions: Natural disasters, political instability, and supply chain bottlenecks can restrict fuel supply.
Environmental Regulations: Cleaner-burning fuels and emissions standards add compliance costs.
Driver Shortages: Inefficient scheduling due to driver constraints increases deadhead miles, raising overall fuel use.
For carriers and shippers alike, the question isn’t if fuel costs will fluctuate—but how to manage them effectively.
1. Embrace Route Optimization Technology
One of the most impactful ways to reduce fuel costs is through smart route planning. Every unnecessary mile burned adds to costs, so minimizing distance and avoiding congestion is critical.
Dynamic Routing Tools: Advanced transportation management systems (TMS) use real-time traffic data, weather reports, and road conditions to recommend the most fuel-efficient paths.
Geofencing & GPS Tracking: Monitoring vehicle movements ensures drivers stick to planned routes and reduces idling at congested intersections or rest areas.
Backhaul Planning: Coordinating return loads avoids costly empty miles.
Welcome Logistics leverages technology-driven solutions to optimize route planning for carriers, ensuring freight moves efficiently with minimal fuel waste.
2. Invest in Fuel-Efficient Vehicles
Equipment choice directly impacts fuel consumption. While older trucks may seem cost-effective upfront, their lower fuel economy can erase any savings.
Aerodynamic Upgrades: Skirts, tail fairings, and nose cones reduce drag, improving miles per gallon (MPG).
Low-Rolling-Resistance Tires: Proper tire choice reduces the amount of energy required to move trucks.
Idle-Reduction Technologies: Auxiliary power units (APUs) and automatic engine shutoffs prevent waste during rest breaks.
Modern Engines: Newer trucks often comply with stricter emissions standards and offer better fuel performance.
Though upgrading fleets requires capital investment, the long-term fuel savings often justify the expense.
3. Adopt Fuel-Efficient Driving Practices
Drivers play a central role in fuel efficiency. Even with the best technology, poor driving habits can negate savings. Training and incentivizing drivers to adopt fuel-smart behaviors can reduce consumption by up to 10%.
Key practices include:
Smooth Acceleration & Braking: Hard starts and stops consume excess fuel.
Reduced Idling: Idling burns about a gallon of fuel per hour; shutting off engines during long waits saves money.
Maintaining Optimal Speed: Fuel efficiency typically drops sharply above 65 mph.
Using Cruise Control: Maintaining steady speeds on highways reduces unnecessary fuel use.
Many carriers implement driver incentive programs tied to fuel efficiency metrics. This approach not only saves money but also motivates drivers to stay engaged and committed to sustainable practices.
4. Monitor and Maintain Equipment Regularly
A well-maintained truck runs more efficiently than one that’s neglected. Preventive maintenance ensures small issues don’t lead to big fuel losses.
Tire Pressure: Underinflated tires increase rolling resistance, costing as much as 3% more in fuel consumption.
Engine Tune-Ups: Regular oil changes, fuel filter replacements, and diagnostics keep engines running efficiently.
Alignment Checks: Misaligned wheels increase drag and reduce efficiency.
By combining maintenance schedules with telematics data, carriers can proactively address fuel-draining issues.
5. Leverage Fuel Purchasing Programs
Fuel prices vary widely across regions and truck stops. Shippers and carriers can take advantage of fuel purchasing programs to save money:
Fuel Cards: Many offer discounted rates, rebates, and detailed reporting to track expenses.
Bulk Purchasing Agreements: Larger fleets often negotiate bulk contracts with fuel providers for consistent pricing.
Regional Pricing Awareness: Avoiding high-cost states or regions (when possible) can make a significant difference in operating costs.
Welcome Logistics helps carriers identify cost-effective fueling strategies as part of an overall cost management plan.
6. Reduce Empty Miles Through Better Collaboration
Deadhead miles—trucks running empty—waste both time and fuel. Industry estimates suggest that as much as 20% of miles driven in trucking are empty.
Ways to reduce empty miles include:
Freight Matching Platforms: Digital freight marketplaces connect carriers with nearby loads to fill backhauls.
Collaborative Logistics: Partnering with other carriers or shippers can ensure trucks stay full more often.
Network Optimization: Shippers can consolidate shipments, reducing the number of half-empty trucks on the road.
Welcome Logistics specializes in connecting carriers and shippers to reduce inefficiencies, saving both money and fuel.
7. Explore Intermodal Options
While over-the-road trucking is the backbone of U.S. freight, it isn’t always the most fuel-efficient option for long hauls. Combining trucking with rail—known as intermodal transportation—can reduce fuel consumption significantly.
Rail Fuel Efficiency: Trains move one ton of freight over 470 miles on a single gallon of fuel—much more efficient than trucks.
Strategic Use: For long-haul shipments, intermodal offers cost savings, while trucks provide the necessary first- and last-mile service.
By evaluating intermodal opportunities, shippers can balance speed with cost efficiency.
8. Consider Alternative Fuels and Sustainability Programs
As the industry moves toward sustainability, alternative fuels are gaining traction. While still developing, these options can provide both cost savings and environmental benefits.
Compressed Natural Gas (CNG) & Liquefied Natural Gas (LNG): Lower carbon emissions and potentially lower costs in certain regions.
Electric Trucks: Still emerging for long-haul use but promising for regional and last-mile delivery.
Biofuels: Renewable diesel and biodiesel blends can reduce emissions and dependency on traditional diesel.
Shippers are increasingly selecting logistics partners based on sustainability practices. Carriers who invest in alternative fuels may gain a competitive edge.
9. Implement Data-Driven Analytics
Fuel management requires visibility. With modern telematics and logistics software, carriers and shippers can track consumption trends, benchmark performance, and identify inefficiencies.
Telematics Systems: Track fuel usage, idle time, and driver behavior.
Predictive Analytics: Use historical data to forecast fuel spend and budget accordingly.
Performance Dashboards: Provide real-time insights to operations managers.
Welcome Logistics uses data-driven insights to help clients monitor performance and continuously refine their strategies for cost reduction.
10. Partner with an Experienced Logistics Provider
Managing fuel costs requires balancing multiple factors: route planning, equipment investments, driver training, data tracking, and more. For many companies, handling all of this internally is overwhelming.
That’s where partnering with a third-party logistics (3PL) provider like Welcome Logistics can help.
Benefits include:
Negotiated Carrier Rates: Leveraging 3PL networks to access competitive rates that offset fuel surcharges.
Route Optimization Tools: Using advanced systems that may be cost-prohibitive for smaller carriers to adopt.
Supply Chain Visibility: Real-time tracking of costs, routes, and performance.
Strategic Consulting: Helping companies develop long-term fuel management strategies aligned with business goals.
By outsourcing logistics management, businesses can focus on their core operations while experts handle cost control.
Conclusion: Taking Control of Fuel Costs
Fuel will always be one of the largest costs in OTR shipping, but it doesn’t have to be unmanageable. By adopting proactive strategies—ranging from smarter routing and efficient driving to alternative fuels and analytics—shippers and carriers can reduce their exposure to fuel price volatility.
The key is a comprehensive approach. Small changes add up, but when combined with technology, collaboration, and expert guidance, they can transform a company’s bottom line.
At Welcome Logistics, we help businesses optimize their supply chains, reduce unnecessary fuel expenses, and move freight more efficiently. Whether you’re a shipper looking to control costs or a carrier trying to maximize margins, we have the tools, technology, and expertise to deliver results.
Managing fuel costs isn’t just about saving money—it’s about building a more sustainable, competitive, and resilient logistics operation.
