The automobile industry is one of North America’s most important economic engines. Brookings published a in 2024 that describes the industry as a whole––including imports and exports of auto parts––as “the largest component of total North American trade.”  In order to build cars, original equipment manufacturers (OEMs) need materials. What makes up a vehicle? Steel, semiconductors, and lithium-ion batteries are essential. OEMs purchase 12% of all steel (including 26% of U.S. steel), 13% of semiconductors, and 75% of lithium-ion batteries sold. When war and disputes over protective tariffs disrupt access to these resources, OEMs suffer, and consequently so do fleets. In this report, we’ll analyze how current economic disruption is impacting supply chains, what it means for OEMs, and what it means for fleets.

How do OEMs manage supply chain in a stable economic environment?

As discussed above, cars cannot be built without suppliers delivering components. These include semiconductors, engines, and electronic modules. Thomas Staeblein and Katsuki Aoki describe the complexity of vehicle production in a in the International Journal of Production Economics, “A modern car consists of 15,000 different parts and components, which are sourced from approximately 200 to 400 different first-tier supplier firms per plant.” In the auto manufacturing industry, the supplies used to build cars amount to of the total cost to operate. Parts and components are sourced by way of a complex web of relationships. An OEM’s production schedule is only as consistent as its suppliers are reliable.

The role of scheduling in auto manufacturing

Different auto manufacturers have different methods of scheduling their projects. The biggest scheduling variables include manufacturing conditions, managerial practices, supplier management, product customization, and product variety. Comparing an OEM’s practices in two different countries, like how a manufacturer would operate in Germany compared to how one would operate in Japan, provides additional technical, cultural, and employment law variables. 

nearly all automakers subscribe to the lean production and “just-in-time” principles developed by Toyota in the 1950s. The “just-in-time” process requires tightly synchronized supply chains. Lean manufacturing attempts to reduce waste by reducing the time that a worker stands idle. They also do so by acquiring the minimum materials required so that materials rarely go unused. Automakers attempt to eliminate over-production—meaning making more product than can be sold in a reasonable amount of time—to make wait times as short as possible, to avoid inefficient transportation activities (shipping product that won’t likely be sold) and unnecessary extra processing, and to diminish the inefficiencies involved when keeping excess inventory on hand. One of the driving principles of lean manufacturing is continuous improvement. How is continuous improvement implemented? Through the project schedule, of course. 

Automakers who work with lean production principles use a Kanban board to help organize their project schedules. Cards on the Kanban board represent tasks, which can be moved within the board to illustrate progress. The Kanban board can help managers track, visualize, and manage product backlogs. The production flow is also well-controlled to allow for greater productivity. 

Supply management is an essential aspect of eliminating waste and practicing a “just-in-time” method. Line managers must fine-tune supply lists and deliver precise calculations for every aspect of operations. When OEMs face delays in supply delivery, or need to alter where and from whom they are purchasing supplies, it becomes increasingly difficult to maintain efficiency, master waste control, and keep production lines moving.

Existing auto manufacturing trends—including electrification, regionalization, competition from Chinese OEMs, and technological disruption—are all continuing to impact the automotive industry

Since the advent of electric vehicles, the automotive industry has gone through significant change. With artificial intelligence, the industry will only continue this process of transformation.

In June 2025, Annabelle Liang and Nick Marsh for The BBC on China’s state-led ascendance in the last ten years, becoming the most dominant and advanced producer of electric vehicles. Liang and Marsh identified government subsidies as one of the most significant drivers of advancement. The Chinese government also created long-term plans beginning in 2007, which they have assiduously followed.

In the United States, the government has repeatedly wavered in offering the incentives which are critical to innovation. As one government administration replaces another, the removal of incentives significantly slows down the production process for OEMs. The top EV manufacturers based on market share are in China (BYD, Geely, Changang, SAIC, Chery), the U.S. (Tesla), Germany (Volkswagen, BMW), South Korea (Hyundai), and the Netherlands (Stellantis). Six countries are adopting EVs at the fastest rate. They are Norway, Sweden, Denmark, Finland, the Netherlands, and China.

The role of smart manufacturing

Smart manufacturing technologies are already transforming the auto industry. As described it in 2022, vehicles have become “computers on wheels.” To keep up with advances in automation brought about by artificial intelligence, automotive factories will need to create complex new manufacturing processes. One example of advanced manufacturing is the way that industrial robotics are revolutionizing what our vehicles are made of and how we build them operationally. Auto makers who wish to compete in the market in the coming years will need to employ 3D printing (otherwise known as additive manufacturing) in order to generate rapid prototyping. The benefits of additive manufacturing include faster lead times, decreased costs, and mitigation of supply chain risks due to an ability to make more parts in-house. 

Designers have developed new production materials in recent years that also require automakers to make changes. High-temp superalloys, smart metamaterials, and advanced biopolymers are all contributing to shifts in how vehicles are manufactured. Beyond changes in their supply chain dealings related to these materials, OEMs also need to ensure that the technology they’re building within the vehicle integrates seamlessly between the vehicle, devices, and broader mobility networks. 

How global conflict, tariffs, and trade wars are impacting OEMs and fleets

Fleet managers looking to replace old vehicles, or add to their commercial vehicle fleets are directly impacted by supply chain issues that OEMs are facing. As reported in April of 2025, incoming levies imposed by the Trump administration represent the most disruptive policy in the history of global trade. When supplies dwindle due to protective tariffs, OEM production slows down, and vehicle prices increase as a result of demand outpacing supply. Today, the average cost of a new car is around and as of December 2025 vehicles costing less than $20,000 became scarce. The supply chain isn’t only influencing the ability to purchase cars, vans, and trucks. Spare parts and after-market components have become harder to come by, impacting the ability for fleets to conduct commercial vehicle maintenance and repairs. Repair costs have also been impacted with auto repair costs increasing in the last year. Fleet managers are facing elevated prices and a shortage of vehicles. The closure of the Strait of Hormuz has hit already strained vehicle supply chains hard.

America’s war with Iran is compounding supply chain disruption during an already difficult economic period. The Middle East is a large supplier of , so as a result of the conflict, oil prices have surged repeatedly above $100 per barrel. This is due both to attacks on refineries and terminals in Iran and the Gulf region and the closure of the Strait of Hormuz. At the beginning of March, jumped to their highest level in almost four years as shipments from the region were disrupted, primarily due to attacks on Middle Eastern smelters and the closure of the Strait of Hormuz. The conflict triggered production cuts in the region—a region which accounts for roughly 9% of global aluminum output. A shutdown of deliveries from major aluminum smelters in Qatar and Bahrain because of attacks on their facilities contributed to the problem. For OEMs and fleet managers, this means a lack of necessary materials, delays to production, a decreased ability to purchase and maintain vehicles, and, inevitably, lower profits. 

Strait of Hormuz closure impacts

Experts have long warned  that attacking Iran would result in the closure of the Strait of Hormuz, a narrow corridor connecting the Persian Gulf to global shipping lanes. As predicted, in the first days of the war, Iran closed the Strait. When shipping routes through the Strait are blocked, supplies needed to build vehicles such as aluminum, petrochemicals, steel, and sulfur don’t arrive at assembly plants on schedule. 

The direct and most obvious impact to the conflict is on oil prices, but there are also air and marine cargo disruptions at play. Flights are being diverted around the Gulf to avoid landing in countries involved in the conflict and to avoid entering airspace that is controlled by those countries. These diversions mean manufacturers must adjust cargo shipment routes, adding fuel costs, and causing some exporters to reduce loads. As a result, the cost of airfreight from Asia to Europe has doubled since the start of the war, and the cost of airfreight from Vietnam to the U.S. has increased by almost half. 

And of course, marine shipments are also impacted —ships that usually pass through the Red Sea are rerouting around Africa, causing higher prices and delays. Insurance costs for ships traveling through high-risk zones have also gone up. As a result American automakers face a lack of access to and an increase in the cost of electronics and car components. For OEMs this has already resulted in paralyzed production lines, a reduction in output, and an increase in operational costs.

Impact of tariffs on supply chain

Tariffs are another source of chaos. The protective tariffs imposed by the American government have increased the cost of manufacturing outside of the United States. OEMs depend heavily on imported supplies. The percentage of auto parts sourced overseas sits at around 40%, said Dan Ives, the global head of technology research at a financial services firm. For automakers, tariffs impose budgetary and operational challenges.

OEMs are forced to evolve amid increasingly unpredictable global supply chains

Supply chains have been fragile since COVID. The war in Ukraine rocked the system starting in 2022, followed by Israel’s war with Palestine beginning in 2024. The tariffs implemented in early 2025, ensuing trade wars, and eventually the war with Iran have led to deepening struggles to efficiently and cost-effectively move energy and commodities around the world.  reported in June 2025 that Jeep, Ford, and Stellantis halted production in their factories due to supply chain disruptions. Aluminum, semiconductors, and rare-earth minerals are consistently unavailable, and this puts production plans into a tailspin. Industry leaders are investing billions (Stellantis alone announced a $13 billion investment to help offset tariffs) to combat tariffs and explore supply alternatives, but high costs and a lack of access to supplies continue to be a major pressure on OEMs. 

In response to supply chain disruption, OEMs and fleets have had to make significant changes to their operations. Read on to learn how they are adapting.

Strategy #1: Focus on resilience

To adapt to supply chain disruption one thing quickly became clear: OEMs and fleets need to boost their resilience planning programs. They have shifted resources to resilience planning, to respond to the current crisis while also ensuring they’re better prepared in the event of future disruption. They envision a future where instead of reacting on the fly to mitigate unforeseen events, they’ll have the tools in place for a proactive and strategic response. Resilience planning includes: 

1. Risk assessment:

• Identify and categorize potential risks systematically.
• Evaluate the likelihood and potential impact of each identified risk.
• Prioritize risks based on their severity. This will allow you to focus resources effectively.

2. Mitigation strategies:

• Develop proactive strategies aimed at preventing risks or minimizing their potential impact.
• Ensure supplier diversity across geographical locations, company sizes, financial stability, and the possibility of dual-sourcing essential components and materials.
• Broaden customer reach by expanding sales channels to help generate diverse revenue 
• Invest in technology and automation to enhance efficiency and reduce vulnerabilities.

3. Business continuity:

• Establish clear and tested procedures to ensure the continuation of essential business functions during disruptions.
• Develop robust backup systems for your data and comprehensive data recovery plans to minimize downtime.

4. Stakeholder communication:

• Establish clear and consistent communication channels with all stakeholders.
• Provide regular updates on the organization’s status and potential disruptions.
• Proactively address concerns and manage expectations to maintain trust and confidence.

With these systems in place, OEMs and fleets can be better equipped for future supply chain disruption. 

Strategy #2: Reallocate resources

Many OEMs and fleets are working to diversify their supplier lists. As a reaction to unreliable access to supplies and parts from overseas auto manufacturers and fleet managers are now looking at contracting with local or nearshore suppliers. Reallocating where resources originate helps tighten the supply chain in the face of global conflict and resultant lack of access to supplies.

Strategy #3: Incorporate supply chain strategy in C Suite level discussions

OEMs and fleets have also increased their supply chain focus internally. Those controlling fleet companies and OEMs are taking on the responsibility of planning how to manage problems brought on by supply chain unpredictability. Once just a part of the sum total of operational planning, supply chain is now a top-level, standalone concern. When executives are in planning and strategy sessions, supply chain is its own line item. By focusing on the supply chain and its attendant concerns, companies are attempting to ensure that production lines stay operating and auto manufacturers’ goals stay on target. For fleets, this means access to the vehicles they need is more assured, and ideally, it will also mean vehicle prices start to come back to a pre-disruption range.

Strategy #4: Use AI for forecasting and planning

OEMs and fleets are developing AI tools to help them forecast and plan for unexpected events, including mitigating the current supply chain crisis. For fleet operators that don’t yet have a business resilience plan, AI is emerging as a helpful partner. Predictive analytics, real-time risk detection, and logistics automation powered by AI are already used widely. As with any use of AI, the human element is important. Placing people within the process to guard against glitches, false information, and misleading bias will be critical to supplant AI use.

Strategy #5: Emphasize flexibility and relationships

In a 2025 report published by the Evlin Ellati and his team determined that both buyer/supplier relationships and a team’s ability to maintain a flexible supply chain strategy contribute to a stronger outcome when firms face economic instability and disruption. 

form bonds that in some cases transcend disruption. There is interdependence between these two roles, and strong relationships help both meet their goals. As Ellati and team describe it, “Collaboration with suppliers has been found to positively influence operational productivity by fostering information flow, reducing uncertainty, and increasing profitability.” These relationships are more than purely transactional. They involve trust, shared information, joint problem-solving, and aligned strategic objectives. 

OEMs and fleets that adapt and are attentive to new technology, that reallocate their resources as it serves them to do so, will survive the turmoil that we are already facing and will continue to face in the coming years. This theory, developed by David Teece, is called Dynamic Capabilities Theory. Sensing opportunities, seizing them, and transforming assets help OEMs and fleets adapt to volatility in the market. Developing dynamism in operational strategy allows auto manufacturers and fleet managers to adjust their supply chains, shift schedules, and absorb knowledge from all the information flowing into the firm to make the most informed decisions. Innovating like this during times of high economic stress allows OEMs and fleets to thrive despite uncertainty. 

Conclusion: The road ahead—how fleets can adapt and what is within their control

Auto manufacturers have taken action in response to the current global supply chain crisis by diversifying supply sources and increasing inventory buffers, and fleets are using what OEMs have done as an archetype for their own planning. What really needs to happen is for both to take a look at their supply chains and build concrete strategies to react when faced with disruption. Focusing on resilience, reallocating resources to nearshore or local, elevating supply chain strategy within the org, using AI for forecasting and planning, and continuing to nurture your provider and supplier relationships will all help OEMs and fleets survive the current turmoil and emerge stronger.

ĚÇĐÄVlogis a leading, global fintech solutions provider, simplifying payments and back-end business processes in the fleet management, benefits management, and corporate payments areas. To learn more, please visit the company’s About ĚÇĐÄVlogpage.

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Are you on the road year-round? This checklist will help!

Download our handy check list and be prepared for every season!

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Read on to discover America’s most unique truck stops. You’ll find more than just the basics – they exude charm and invite everyone to pause, refuel, and embrace the freedom of the open road. 

1. South of the Border (Dillon, South Carolina)

Source:

South of the Border Truck Stop is a quirky place and a roadside attraction unto itself. It boasts colorful billboards, decor, and a wide array of amenities. These include restaurants, shops, and even a miniature golf course. Travelers are drawn to its unique atmosphere and photo-worthy landmarks, making it a must stop destination.

2. Iowa 80 (Walcott, Iowa)

Source:

As the world’s largest truck stop, Iowa 80 offers an unparalleled range of services and amenities. These include multiple restaurants, a trucking museum, a movie theater, and even a dental office. Its sheer size and comprehensive offerings make it a favorite among truckers and travelers alike.

3. Russell’s Travel Center (Glenrio, Texas)

Source:

Nestled on the border between Texas and New Mexico, Russell’s Travel Center is a nostalgic throwback to the Golden Age of Route 66. With its retro diner, vintage gas station, and western-themed decor, it’s a charming stop for those seeking a taste of Americana. At the same time, it provides a wonderful glimpse into the past.

4. Little America Travel Center (Flagstaff, Arizona)

Source:

Settled within the stunning scenery of Northern Arizona, Little America Travel Center offers a tranquil getaway for travelers and truckers alike. Just 80 miles from the Grand Canyon, Little America is a popular destination for its hotel and natural attractions. Its expansive grounds feature lush gardens, a picturesque pond, and upscale amenities. Amenities include a restaurant and gift shop, and provide a welcome respite from the desert landscape. 

5. Jubitz Travel Center (Portland, Oregon)

Source:

Located in Portland, Oregon, the Jubitz Truck Stop and Travel Center has everything you need and expect from a truck stop as well as a few fun additions. Live music, a ton of fun shops, and an actual movie theater grace this particular truck stop and travel center! With a stellar reputation and a famous saying attached to it who wouldn’t want to visit: “If you can’t get home, get to Jubitz!”

As you traverse the highways and explore these five truck stops scattered across the U.S., take the chance to experience some unique parts of American culture and history. From quirky roadside attractions to tranquil getaways, each stop leaves a mark on your journey. So as you continue your long-haul trip, take some time to embrace the freedom of the open road and take inspiration from some of these fun, unique destinations. 

Learn more on how to better manage your over-the-road fleet:

• Fuel card FAQs
• Fraud prevention
• Safety tips
• Tax prep

To learn more about WEX, a dynamic and nimble global organization, please visit our About ĚÇĐÄVlogpage.

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Download this eight safety essentials one-sheeter and share with your team today!

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Driver toolkit: Safety essentials for your truck

1. Keep a fire extinguisher in your work truck

Fire extinguishers top the list of the They are an important tool because fires tend to go undetected and unanticipated until it’s too late. According to the in 2022 13% of all fires – 188,500 instances – were vehicle fires. Fire departments responded to an average of one highway vehicle fire every 2 minutes and 47 seconds. Don’t run the risk of your employees becoming a statistic. Fire extinguishers are inexpensive and easy to find. Equip every vehicle in your fleet with one, from service vehicles to sales vehicles.

2. Have a toolkit including flashlight in your vehicle

This one’s obvious, but often overlooked. Nearly every driver has experienced the frustrations of not having the proper tool for a given situation. Therefore, equip your drivers with the most common tools they might need, starting with a flashlight. Avoid costly mistakes and wasted time and resources. Ensure your drivers are well-prepared and jobs get completed with utmost efficiency.  

3. Keep back-up engine fluids on hand

Providing your drivers with back-up fluids, like oil, coolant, and antifreeze, saves the day when an emergency arises. Your commercial vehicle drivers may not always be near a service station or mechanic, so it’s important to equip them with a surplus of necessities. If a warning light comes on, drivers simply replace any liquids they need, bypassing the need to search for a store, and eliminating the risk of running out.

4. Navigation system and road atlas should be in your vehicles

Even in commercial vehicles without a GPS tracking system and/or onboard navigation system, your drivers probably use a navigation app on their cell phone. Even so, phone batteries die and navigation systems fail. It’s best to have a back-up plan in the form of a city map or a road atlas for every truck, van, or car in your fleet.

5. Keep jumper cables and a portable battery jump starter in your commercial vehicles

Jumper cables are great when there are other drivers nearby who are willing to lend a helping hand. But what about a dead battery on an empty highway? There are now lithium-ion powered jump starters with up to 80 jumpstarts in only one charge. Some models offer built-in extras like LED flashlights/warning lights and USB ports to charge a cell phone or laptop. Consider purchasing one for each vehicle in your fleet.

6. Reflective gear and high-visibility clothing are good to have in your trucks

Reflective equipment, like emergency triangles and flares, warn other drivers of a vehicle emergency. The Federal Motor Safety Carrier Administration requires drivers follow certain placement protocols for warning devices on different types of roads. For two-lane, undivided highway, follow this protocol:

• Place devices within 10 minutes of stopping,
• One device placed on the traffic side of the vehicle 10 feet away,
• One in the middle of the lane, 100 feet behind the vehicle, facing oncoming traffic,
• And one in the middle of the lane, 100 feet in front of the vehicle, facing away from oncoming traffic.

These items, in addition to high-visibility apparel, are vital for employees or drivers attending to a vehicle on the roadside. Make sure your emergency roadside kits contain these items.

7. Keep food, water, and spare clothes in vehicles

If driving conditions are bad or if your workers are spending a great deal of time in rural or remote areas, they will be glad they have food, water, and a change of clothes. There are myriad situations that could cause a driver to be stranded. Taking every precaution is just good business sense for you and your employees.

8. Personal protective equipment (PPE), and spill response kits are must-haves

If your work trucks carry any hazardous materials (i.e. pesticides, fuels, caustics, etc.), it is essential that your fleet adheres to all local and national transportation safety laws. Personal protective equipment, like eye protection, hard hats, and gloves, keep drivers safe from hazards on the road. A spill response kit is a must-have item in case of an accident or mechanical failure resulting in a hazardous material spill.

Adding these items to your work trucks may just help to protect your bottom line while keeping your employees safe and operational in the field.

ĚÇĐÄVlogis a leading, global fintech solutions provider, simplifying payments and back-end business processes in the fleet management, benefits management, and corporate payments areas. To learn more, please visit the company’s About ĚÇĐÄVlogpage.

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Editorial note: This article was originally published on March 27, 2019, and was updated for this publication.

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Every job has its difficulties, and being a long-haul trucker is no exception. In this article, we’ll discuss how the freedom and flexibility of trucking can also include challenges for career drivers but by following best practices, truckers, fleet managers, and owners of trucking companies can work together to create healthy lives for truck drivers both on and off the road.

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Your truck drivers will be well-prepared with this infographic sharing checklists for navigating every season on the road

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Common OTR challenges and how to overcome them

Most careers come with challenges and hardships. For a trucking company, it’s up to each individual employer and driver to collaborate and navigate the inherent difficulties that being a road warrior brings. Together, you can ensure optimal health and well-being and even enhance job satisfaction.

Long hours

Long-haul trucking, while regulated, involves working long hours—hours are capped at . There are lots of great ways employers and professional truck drivers can mitigate the effects of long days and/or nights behind the wheel including:

• Allowing regular breaks: Encourage drivers to take regular breaks to rest, hydrate and recharge, and educate them about .
• Monitoring and regulating hours: Ensure that drivers adhere to regulated hours of service to prevent fatigue.
• Using technology: Telematics and GPS monitoring systems help fleet managers identify driving patterns and detect signs of fatigue or unsafe driving, deploying additional training and alerts as necessary to improve driver safety.

Avoid sitting for too long and eat healthy food when possible

Driving for a living has you sitting for periods of time, and sitting for too long can have negative health implications. It can also be difficult sometimes to find healthy food options while on the road. You’ll want to focus on finding healthy meals on the road and maintaining good stretching habits as you make your way between jobs as this will

Finding places to exercise, access healthcare, or even get a good meal are important goals while on the road. With this in mind, here are a few tips to help drivers:

• Conduct regular health screenings: Offer regular health screenings for drivers to monitor their physical condition and catch potential health issues early.
• Offer fitness incentives: Rewarding drivers who participate in fitness programs or achieve certain health goals incentivizes them to build and maintain healthy habits.
• and hydration: Performing back, neck, and leg stretches at long stops or while sitting in traffic can help drivers relieve tension and improve blood circulation. Additionally, regular hydration through consistent water intake is good for overall health and relieving brain fog.

Working through feelings of isolation

Truck driving can offer a unique level of zen that other professions simply cannot match. While long hours spent alone sound ideal for many, so much time away from family and friends might sometimes contribute to feelings of isolation.

While tricky, here are a few ideas for employers to use to help their drivers navigate this unique element of their jobs:

• Foster a sense of community: Online social platforms, mentorship programs, and regular in-person events and meet-ups are all great ways to bring drivers together.
• Check-in regularly: Implement regular check-ins between drivers and their managers or dispatchers. This can be as simple as a weekly phone call to see how they’re doing, discuss any concerns, or just chat.
• Encourage the work-life balance drivers need to succeed: Advocate for drivers to take time off and ensure they have opportunities to spend time with family and friends when not on the road.
• Encourage bringing a favorite furry friend along for the ride: Help make drives more fun, and bonus: most dogs love riding shotgun! Ensure your company sanctions bringing pets on the road and then brighten your drivers’ trips when they can have a favorite canine companion sitting by their side.

Optimizing for a healthy and happy life on the road

There are numerous other ways truck drivers and their employers can support good work-life balance and good health on the road and off. Read on to learn more.

Offer flexible routes and schedules

Allowing drivers to choose routes and schedules that align with their personal needs and preferences is a great way to facilitate their well-being. While the nature of the trucking industry sometimes leans on seniority for preferred routes, understanding why drivers prefer certain routes can help employers make choices rooted in practicality as well as tenure.

Outline predictable home time

When drivers have a reliable sense of when they’ll have time off, they can better plan their personal lives. Whether to attend important events and occasions or simply spend time with their families, knowing when they’ll have downtime at home is integral to a healthy work-life balance.

Make cabs comfortable

While the level of control that OTR companies have here may be minimal, there are a multitude of quality-of-life cab features and regular (but simple) maintenance checks that can help ensure a driver’s comfort, such as good ergonomic seating, safe and well-suited sleeping accommodations, and climate control.

Offer roadside assistance

Mechanical issues happen. When they do, that can cause stress for drivers who are already running on tight schedules. When things go wrong on the road, emergency roadside support can be a lifesaver –  especially when employers offer a program that keeps their truckers from having to personally cover out-of-pocket costs to get their trucks back up and running.

Take training seriously

Training goes a long way in the trucking industry and it applies to all job areas. For example, ensuring that drivers are clear on necessary safety protocols – and that those protocols are regularly reinforced – can help keep drivers safe including reducing accidents and avoiding other safety issues. Also, training on aspects like stress management, mindfulness, and other mental health strategies can help drivers gain control over their day and their health, and feel better prepared to take on a day on the road.

Use technology

Tech tools can be a big help in trucking and can simplify both drivers’ and employers’ lives. For instance, the right fleet fuel card can help drivers fill up when and where they need to with extra protection from fraud, make it easy to purchase fleet- and business-related products and services, and bypass needing to collect and submit receipts. 

For fleet managers, GPS and telematics tools can help give clear insight into their fleet vehicles and employees’ driving habits, improve routing, and plan preventive maintenance to keep trucks in good working order (keeping their drivers safe and reducing unnecessary downtime that can be highly disruptive to delivery schedules).

ĚÇĐÄVlogcan help set up drivers for success

ĚÇĐÄVlogover-the-road (OTR) solutions  – including fleet cards and telematics programs – are designed for truckers and fleet managers alike. With WEX, it’s simple to get equipped with the tools, technology, and data required to optimize fleet operations. Optimize in ways that help drivers effectively manage their lives on the road and focus while all the while delivering an excellent customer experience.

Create a better life on the road for your drivers

Truck driving as a career choice can lead to a life of freedom and flexibility, and while there isn’t a job that doesn’t have its challenges, there are some easy things you can do to help ease trucking challenges for yourself and your drivers. Start today in creating a healthier experience for your truckers both on and off the road by following the tips above.

Curious about ĚÇĐÄVlogOTR solutions? Browse ĚÇĐÄVlogfuel cards, and OTR products and services and apply for a fleet card today!

All fleet cards are not the same, and different types of fuel cards suit the needs of different kinds and sizes of businesses. View WEX’s OTR fleet card comparison chart to see which fleet fuel card is right for you.

Learn more on how to better manage your over-the-road fleet:

• Fuel card FAQs
• Fraud prevention
• Safety tips
• Tax prep

Apply for a fleet card today!

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Editorial note: This article was originally published on September 10, 2024, and has been updated for this publication.

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Here, we’ll expand on the benefits of comprehensive vehicle health monitoring. This will include discussing how proactive maintenance scheduling provides you with efficient cost control and extended fleet longevity.

The fleet manager superpower: Telematics

Learn the value of telematics for building a more efficiencient fleet.

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The importance of fleet vehicle diagnostics

Automotive maintenance costs continue to escalate due to supply chain issues and the continued strain of tariffs and global trade wars. In 2024 conducted research into vehicle ownership and found that the average annual maintenance cost for passenger vehicles increased to $1,234, representing a 12% jump from the prior year. Rising labor costs and an increase in the necessity to purchase parts from outlier suppliers are impacting maintenance schedules, increasing service delays. 

Diagnostic trouble codes (DTCs) give fleet managers visibility into the current state of their vehicles, helping them determine their condition and usage, and when to take them off the road for necessary service.

Fleet managers gain comprehensive insights and data through DTCs and maintenance alerts delivered by telematics, empowering them to increase operational efficiency and minimize maintenance expenses.

How DTCs and maintenance alerts augment fleet management

According to in Q1 2025 the average service cost per vehicle reached $105.87. This was a 2.6% increase from Q4 2024. Parts costs have gone up as well with a 15-25% increase since 2022. With the technician shortage continuing to impact fleet management, labor costs also continue to rise at 8-15% annually.

DTCs and maintenance alerts based on the current condition of a vehicle present an opportunity to reduce the per-mile cost of maintenance and repair for small, medium, and large fleets in these ways:

• Prioritization of repairs: DTCs provide information about the severity of a problem, helping fleet managers prioritize repairs based on the urgency and potential impact on vehicle performance.
• Reduced downtime: By addressing issues early on, fleet managers can minimize unexpected breakdowns and reduce downtime for vehicles, ensuring they remain operational for longer stretches.
• Optimized maintenance schedules: DTCs can help fleet managers optimize maintenance schedules. Instead of relying on fixed intervals, they can tailor maintenance based on the actual condition of each vehicle.

Reliable vehicles not only help keep drivers, cyclists, and pedestrians safe, but can improve employee and customer satisfaction, too. By reducing the stress of vehicle maintenance on drivers and management, everyone has time and energy to focus on growing the business.

Proactive fleet monitoring with WEX

ĚÇĐÄVlogtelematics enables proactive fleet monitoring capabilities by providing near real-time, accurate data on vehicle health, usage, driver behavior, and more.

Collect valuable, accurate, and current vehicle-level data across your fleet. Reporting and insights are all presented in one central platform to help you schedule preventive maintenance, increase driver safety, and reduce operating costs.

For additional benefits, consider integrating telematics data with your ĚÇĐÄVlogfleet card to amplify the advantages of both GPS tracking and fuel management. If you want to go even further, dash cameras can help enhance driver behavior monitoring and overall on-the-road safety. 

Ready to learn more? Get started today.

All fleet cards are not the same, and different types of fuel cards suit the needs of different kinds and sizes of businesses. View WEX’s fleet card comparison chart to see which fleet fuel card is right for you.

ĚÇĐÄVlogspeaks the language of small business operators. Whether you’re looking to modernize your insight and reporting efforts, save on fuel costs or take advantage of the latest GPS tracking technologies, ĚÇĐÄVlogoffers solutions to simplify the business of running a business. To learn more about WEX, a dynamic and nimble global organization, please visit our About ĚÇĐÄVlogpage.

Learn more on how to better manage your business:

• Marketing tips
• Trends
• Sustainability
• Artificial intelligence

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Can I use my HSA or medical FSA to pay for dental expenses?

The good news is that an HSA or medical FSA can be used to pay for certain dental expenses! Keep in mind that there may be some limitations and exclusions depending on your specific plan. Our eligible expense list covers what’s eligible for HSA or medical FSA funds. 

Can I use my HSA or medical FSA for teeth cleaning? 

Teeth cleaning is considered a preventative service, which is covered by HSAs and medical FSAs. Using your HSA or FSA to pay for teeth cleaning can be a smart way to maximize your healthcare dollars while taking care of your oral health. 

Can I use my HSA or medical FSA for a tooth extraction?

The answer is generally yes, as tooth extraction is considered a dental procedure, it is from both HSAs and medical FSAs. However, it’s important to recognize that the extent of coverage may depend on your specific plan and the reason for the extraction. For example, if the extraction is necessary due to a medical condition such as gum disease, it may be covered by your medical plan, rather than your HSA or FSA. 

What other dental costs can I use HSA or medical FSA funds on?

In addition to teeth cleaning and tooth extraction, there are other dental costs that you can use HSA or FSA funds on. These include fillings, crowns, bridges, root canals, and braces. HSAs and medical FSA funds can also be used to purchase dentures, implants, and . 

What dental expenses are not HSA- or FSA-eligible?

While there are many dental expenses that can be covered by HSAs or FSAs, there are also certain expenses that are not eligible for reimbursement. For instance, cosmetic dental procedures such as teeth whitening or veneers are generally not covered by HSAs or medical FSAs. Over-the-counter dental products, such as toothpaste or mouthwash, are also not eligible for reimbursement from HSAs or medical FSAs, unless they are prescribed by a dentist. 

What do I need from my dentist to file a claim? 

Luckily, HSAs do not require claim filing! However, medical FSAs do. When expenses are paid for with a benefits card, you may need documentation of: the date service was received or purchase was made, a description of the item or service purchased, the dollar amount, and the provider or store name. 

Interested in purchasing HSA-eligible or FSA-eligible dental expenses?  

The information in this blog post is for educational purposes only. It is not legal or tax advice. For legal or tax advice, you should consult your own legal counsel, tax and investment advisers. 

ĚÇĐÄVlogreceives compensation from some of the merchants identified in its blog posts. By linking to these products, ĚÇĐÄVlogis not endorsing these products.

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Here, we’ll discuss just how disruptive cargo theft is, both to individual trucking businesses and the OTR industry as a whole, and how fleet managers can take proactive steps to help mitigate business impacts.

The cargo theft problem

In Q1 2026, the freight security network, reported cargo theft losses surged to an estimated $725 Million in 2025. This represents a 60% increase from 2024, and fraudsters were increasingly stealing shipments containing more expensive cargo than in years past. According to their analysis, the average value per theft increased 36% between 2024 and 2025.

While cargo thieves tend to target larger freight and vehicles, fleets of all sizes are still vulnerable to theft. Warehouses, distribution centers, and truck stops are top-targeted locations.

Whether you operate a delivery service, transportation company, or any business reliant on transporting goods, protecting your assets against theft should be a priority.

Download our cargo theft prevention infographic

Share 10 essential strategies to prevent cargo theft with your drivers today.

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Common cargo theft methods to be aware of

Before exploring a few theft prevention strategies, it’s important to know what you’re up against. Unfortunately, savvy criminals have devised numerous ways to gain access to valuable cargo. Before we can plan to protect ourselves against a cargo theft incident, we have to know how they commonly occur.

Straight cargo theft

Fittingly, straight cargo theft is perhaps the most straightforward method. It happens when someone steals an entire shipment of cargo from a location where it’s stored, like warehouse loading docks, airports, or train stops.

Strategic cargo theft

More sophisticated than other methods, strategic cargo theft is a planned theft of goods during their transportation or storage. Criminals often employ deceptive social engineering strategies or other forms of fraud and use inside supply chain knowledge to their advantage.

Burglaries/hijackings

Whether taken by force or simply stolen while the truck driver steps inside a rest stop, burglaries and hijackings are a common method of cargo theft. They can be spontaneous or planned, wherein a criminal may spend hours or days tracking a vehicle’s route to plan the perfect attack.

Driver involvement/inside job

Unfortunately, there are drivers – albeit a small subset – who engage in cargo theft. When drivers get involved in stealing from your business, it could mean they simply hand cargo over to thieves willingly for money or they might engage in more direct activity like staging a hijacking.

Fake IDs/fictitious pickups

Using fake IDs, or fictional pickups, criminals will impersonate a driver to gain access to the cargo or cargo vehicle. Once successful, they depart with the goods.

These examples are just a selection of common methods criminals use to steal cargo. Many more exist, and fraudsters are always innovating to make stealing from you easier. That said, each theft prevention strategy listed below can help fleet managers and business owners protect their payloads — whether by making cargo more difficult to steal or being more mindful of driver routes and stops.

10 essential strategies to protect your fleet from cargo theft

As the saying goes, it’s always better to prepare for the worst. While hopes are high that cargo theft will stabilize after a rocky first quarter, fleet businesses can take proactive measures now to deter criminals and minimize the impact of theft on their drivers and businesses if incidents happen.

1. Invest in better security measures

Unprotected vehicles are prime targets for thieves. Each fleet vehicle should be equipped with state-of-the-art security systems and features, such as: 

Alarm systems

Designed to detect unauthorized entry or tampering with your vehicle, alarm systems do more than your standard car alarm. They typically consist of sensors placed on doors, windows, and other entry points, which trigger a loud siren or horn when activated. This not only deters thieves from the act but also alerts others to potential criminal activity, increasing the likelihood of intervention or apprehension. Modern alarm systems may also come equipped with features such as remote arming/disarming and smartphone notifications, allowing you to stay connected and in control of your vehicle’s security at all times.

Dash cameras

In-cab dash cameras are a great cargo security feature and are becoming increasingly vital in fleet operations. Not only do they act as a visual deterrent but fleet managers can pull video files captured via the dashcam and hand them over to law enforcement to identify and, hopefully, prosecute cargo thieves.

2. Conduct thorough background checks

Trustworthy drivers are essential to ensuring the safety and security of your vehicles.

Conduct multiple background checks—not only during the initial driver hiring process but also periodically throughout an employee’s tenure. Regular screenings help ensure that drivers maintain their trustworthiness and are compliant with company policies and industry regulations. Also, consider implementing drug and alcohol testing programs to avoid risks associated with impaired driving.

3. Train drivers on cargo security protocols and teach theft response strategies

Emphasize the importance of vigilance and situational awareness while on the road, encouraging drivers to remain alert to their surroundings and report any unusual or concerning activities immediately. 

Educate drivers to recognize suspicious behavior. Teach them common indicators of theft such as someone loitering near the vehicle, attempts to access the vehicle, or erratic behavior. Drivers should trust their instincts and err on the side of caution when confronted with potentially threatening situations.

Additionally, encourage your drivers to prioritize their own safety and avoid confrontation whenever possible. Their best plan is to cooperate with law enforcement and provide information to aid in recovery efforts.

4. Encourage open communication and reporting

Open communication channels between drivers, dispatchers, fleet managers, and security personnel is especially important for staying up-to-date on any challenges and safety concerns. Have drivers report to their superiors periodically throughout or at the end of their shift. If something suspicious happens, drivers should notify managers as soon as safely possible.

5. Use secure parking and storage facilities

Drivers should park in secure areas that are equipped with surveillance cameras and perimeter fencing whenever possible. If you own your storage facility or parking area, make sure to install appropriate safeguards, such as motion-activated lighting, to discourage criminal activity. The safest storage areas should be securely locked and preferably gated.

When instructing your drivers toward a truck stop, stress the importance of always locking their vehicles and carrying the key with them when stepping away from the vehicle. For overnight parking, advise them to choose well-lit, heavily trafficked areas with enough surveillance and pedestrian presence.

6. Optimize routes to avoid problem areas

Route planning software can be a saving grace for drivers, especially those who operate in unfavorable areas. Use routing technology to create a delivery course that intentionally avoids high-risk areas known for cargo theft.

Paired with telematics and GPS technology, fleet managers can monitor vehicles to ensure they adhere to planned routes and schedules as well as discern any suspicious patterns from collected data. Leveraging available tools and software gives you more control over operations, even while drivers are en route.

7. Conduct regular maintenance and inspections

Regular vehicle maintenance is an important part of fleet safety. Implementing a proactive maintenance program ensures that trucks remain in good condition, which reduces the risk of breakdowns and accidents and, subsequently, unnecessary downtime that could lead to cargo theft.

Also, make sure your drivers have a system for reporting vehicle issues before they become a major problem. Have them inspect trailers and cargo containers for signs of tampering or unauthorized entry before each trip.

8. Invest in insurance coverage that meets your business needs

Insurance coverage is a fundamental part of operating a fleet business—especially when it comes to protecting against the threat of cargo theft. Here are some factors to consider when choosing an insurance plan:

Shop for comprehensive insurance coverage

This type of coverage typically includes non-collision events such as theft, vandalism, hijacking, and other forms of criminal activity that may result in the loss or damage of cargo during transit. Review insurance policies carefully to understand the scope of coverage, including any limitations, deductibles, and exclusions that may apply. 

Customize the insurance policy

Every fleet is different, so fleet managers should work with their insurance provider to customize an insurance policy that meets the needs of the business. Tailored policies take variables into account such as:

• The type of cargo being transported.
• The value of goods at risk.
• Shipment frequency and distance.
• Geographic regions vehicles serve.

As your business grows or diversifies its operations, insurance needs may change. Meet with your insurance provider periodically to assess the adequacy of coverage, identify any gaps, and explore options for enhancing protection through additional coverage.

Some providers offer specialized policies designed for cargo, which may include coverage for high-value cargo; goods in transit across international borders; or specific types of cargo that are more susceptible to theft, such as electronics, beauty products, pharmaceuticals, or luxury goods.

9. Listen and learn from your community

Your wider community can help spread awareness of potential threats, acting as an added layer of protection on the road. Collaborate with other businesses to share information about recent attempted theft or suspicious activity and engage with law enforcement agencies to stay informed about any emerging threats.

Many communities have online portals, email newsletters, or apps where members can share information or make informal reports. Whether it’s forming a neighborhood watch group, participating in community events, or volunteering for local initiatives, building relationships within your community can create a resilient support system that not only protects your business but also strengthens the fabric of the collective.

10. Enroll in a fuel card program

Fuel cards can help protect against cargo theft indirectly, giving fleet managers more control over their vehicles while creating a trail of data that can help trace criminal activity back to the source:

• Transaction monitoring and alerts: Fleet fuel cards with real-time monitoring features allow managers to track transactions as they occur. Unusual purchase patterns, such as fuel bought far from the planned route, can trigger alerts and prompt managers to investigate and potentially identify unauthorized vehicle use that could indicate a cargo theft attempt.
• Purchase limits: Fleet managers can set limits on the amount of fuel that can be purchased, where it can be purchased, and even the time of day when purchases are allowed. This reduces the risk of drivers making unauthorized stops, which could lead to cargo being targeted by thieves.
• Driver identification and PINs: Each driver is typically assigned a unique PIN or card, making it easier to identify who is using the card at any given time. This system can prevent unauthorized individuals from purchasing fuel, reducing the chances of collusion between drivers and criminals.

Take control of your vehicles and their cargo

Every cargo theft prevention strategy, no matter how big or small, is invaluable for protecting your payloads. From installing dashcams to tracking driver behavior via telematics and fuel cards, the more protections you have in your operations, the better equipped you are to tamp out threats before they happen.

Discover how ĚÇĐÄVlogcan provide the fleet transparency and tracking you need to secure your precious cargo. Get started today.

All fleet cards are not the same, and different types of fuel cards suit the needs of different kinds and sizes of businesses. View WEX’s fleet card comparison chart to see which fleet fuel card is right for you.

Learn more on how to better manage your over-the-road (OTR) fleet:

• Fuel card FAQs
• Fraud prevention
• Safety tips
• Tax prep

Apply for a fleet card today!

Editorial note: This article was originally published on April 1, 2024, and has been updated for this publication.

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For businesses that rely on a fleet of vehicles, whether large or small, the TCO can significantly impact their bottom line. By thoroughly evaluating TCO, companies can make more informed decisions about which vehicles to purchase, how to maintain them efficiently, and when to replace them. This approach not only helps in managing immediate expenses but also aids in long-term financial planning and strategic fleet management. Understanding TCO is therefore not just about cost-savings; it’s a vital element in the sustainable and profitable operation of any fleet-dependent business.

Understanding TCO for commercial vehicles

In commercial vehicle management, Total Cost of Ownership (TCO) stands as a comprehensive metric encapsulating all expenses associated with a vehicle throughout its operational lifespan. TCO is not just about the sticker price of a vehicle; it’s an all-encompassing figure that includes every cost incurred from the point of purchase to the end of a vehicle’s use. This holistic approach ensures that businesses can accurately assess the long-term financial implications of their fleet investments.

The key components of TCO for commercial vehicles include:

• Purchase price: The upfront cost of acquiring a vehicle. It’s the baseline figure that TCO calculations build upon.
• Fuel costs: One of the most significant ongoing expenses. Fuel efficiency plays a pivotal role in this component, and it varies based on vehicle type and usage patterns.
• Maintenance and repairs: Regular maintenance is essential for keeping vehicles operational and safe. Unexpected repairs can also contribute significantly to overall costs.
• Insurance: Insurance premiums are a necessary expense for protecting against potential losses due to accidents or theft.
• Depreciation: The loss in value of a vehicle over time. This is a cost factor to pay attention to, especially for businesses that plan to resell their vehicles.
• Licensing and registration fees: Mandatory legal costs that can vary depending on the vehicle and location.
• Downtime costs: The hidden cost when a vehicle is not operational, impacting business operations and profitability.
• Resale value: The expected return from selling the vehicle at the end of its useful life.

By carefully analyzing these components, businesses can gain a clear and comprehensive understanding of the true long-term costs of their commercial vehicles. This understanding will help you make informed decisions about fleet composition, maintenance strategies, and overall fleet management policies.

Purchase price and depreciation

The initial purchase price of a commercial vehicle significantly impacts its TCO. This upfront cost sets the baseline from which all other expenses are calculated. While a lower purchase price might seem economically advantageous at first glance, it’s important to consider the vehicle’s quality, longevity, and suitability for the intended use. Investing in a higher-priced vehicle that is more reliable, fuel-efficient, or better suited to specific tasks can ultimately lead to lower TCO due to reduced maintenance costs and better fuel economy.

Depreciation is another factor in determining TCO. It represents the decrease in value of a vehicle over time. For most commercial vehicles, the most significant depreciation occurs in the first few years after purchase. This reduction in value is influenced by factors such as the vehicle’s brand, model, market demand, and how well it’s maintained.

For businesses planning to resell their vehicles, it will be helpful to understand the depreciation curve. Vehicles with slower depreciation rates may cost more initially but can offer better value in the long run as they retain a higher resale value. In the context of TCO, depreciation is a hidden cost that doesn’t directly affect cash flow but significantly impacts the overall financial assessment of a fleet. Therefore, when evaluating potential vehicle purchases, companies must consider both the immediate financial impact of the purchase price and the long-term implications of depreciation.

Operational costs

Operational costs form a substantial part of the TCO for commercial vehicles. These recurring expenses, mainly comprising fuel, maintenance, and repairs, can vary widely depending on the vehicle type and its usage.

Fuel costs:

Fuel expenses often represent the most significant operational cost for your business. The fuel efficiency of a vehicle is influenced by its make and model, engine type, and size. For instance, diesel engines are typically more fuel-efficient for long-distance haulage, but they might not be the most cost-effective option for urban, stop-start driving conditions. Additionally, the cost of fuel is subject to market fluctuations, making it a variable and sometimes unpredictable expense. Fuel costs are also impacted by driving habits; aggressive driving can increase fuel consumption, thereby raising expenses.

Maintenance and repairs:

Regular maintenance is vital to keeping vehicles in optimal condition and preventing costly breakdowns. The cost of maintenance can vary depending on the vehicle’s type – for example, electric vehicles might have lower maintenance costs due to fewer moving parts but can incur higher costs if specialized repairs are required. The frequency of maintenance and the cost of parts and labor are influenced by how intensively the vehicle is used and the conditions in which it operates. For instance, vehicles used in harsh environments or for heavy-duty tasks may require more frequent and expensive maintenance.

Impact of vehicle type and usage:

The type of vehicle and its intended use play a significant role in operational costs. A heavy-duty truck used for long-haul transport will have different fuel and maintenance requirements compared to a light commercial vehicle used for local deliveries. Additionally, vehicles designed for specific tasks (like refrigerated units) might incur additional operational costs related to their specialized equipment. Usage intensity also affects these costs; vehicles in constant use or those carrying heavy loads will likely consume more fuel and require more frequent maintenance.

Therefore, when assessing TCO, it’s imperative to consider the specific operational demands of the fleet and choose vehicles that align with these requirements. This careful consideration helps in accurately forecasting operational costs and optimizing the overall efficiency and cost-effectiveness of the fleet.

Insurance and licensing

Insurance and licensing are essential yet often overlooked components in the TCO of commercial vehicles. These costs, while mandatory, can vary significantly based on several factors and require careful consideration to manage effectively.

Insurance costs:

The cost of insuring a commercial vehicle is influenced by the vehicle type, its use, the driving records of operators, and the coverage level chosen. Larger, more expensive vehicles, or those used for high-risk operations, typically incur higher insurance premiums. To effectively manage these costs, businesses should consider shopping around for the best insurance rates and negotiating for discounts based on safety features or a good driving record. Implementing rigorous safety programs and driver training can reduce the risk of accidents, potentially lowering insurance costs.

Licensing fees:

Licensing fees are a fixed cost associated with legally operating a commercial vehicle. These fees can vary by location and vehicle type. Businesses can manage these costs by ensuring timely renewals to avoid late penalties and keeping accurate records to streamline the licensing process.

Cost management tips:

• Bundle insurance policies for multiple vehicles to potentially receive discounts.
• Regularly review and adjust insurance coverage to match the current value and use of the vehicle, avoiding over-insurance.
• Maintain a good safety record and implement telematics to monitor driver behavior, as insurers may offer discounts for lower-risk fleets.
• Stay informed about changes in licensing fees and regulations to ensure compliance and avoid unnecessary expenses.

By strategically managing insurance and licensing costs, businesses can significantly reduce their overall TCO, making their fleet operations more cost-efficient and sustainable.

Downtime and resale value

Resale value and downtime are critical factors in the TCO of commercial vehicles, often impacting long-term financial outcomes.

Downtime:

Downtime refers to periods when a vehicle is not operational due to maintenance, repairs, or accidents. This non-productive time can significantly affect TCO by not only incurring direct repair costs but also by causing revenue loss due to interrupted operations. To minimize downtime, proactive maintenance is key. Regular checks and servicing can prevent major breakdowns. Investing in reliable vehicles and using telematics to monitor vehicle health can also predict and prevent potential issues. Efficient scheduling and contingency planning, such as keeping a spare vehicle, can mitigate the impact when downtime does occur.

Resale value:

The resale value of a commercial vehicle plays an important role in TCO. A higher resale value can offset initial purchase and operational costs. Factors affecting resale value include the make and model of the vehicle, its maintenance history, mileage, and overall condition. To maximize resale value, it’s best to maintain vehicles well and keep comprehensive service records. Choosing vehicles with a reputation for durability and longevity and avoiding customization that limits potential buyers can also enhance resale value.

Both downtime and resale value are factors in the TCO equation. Minimizing downtime ensures continuous operation and revenue generation, while a strong focus on maintaining resale value helps recover a significant portion of the initial investment, ultimately leading to a more cost-effective fleet management strategy.

Why evaluating TCO is an important fleet management practice

Evaluating the TCO for commercial vehicles is an indispensable exercise for businesses seeking efficient and cost-effective fleet management. Key takeaways include considering not just the initial purchase price, but also the ongoing costs like fuel, maintenance, insurance, and licensing. Additionally, understanding the impact of depreciation, downtime, and resale value will help you build efficiencies. These elements collectively influence the TCO and thus, the profitability and operational efficiency of a business. A holistic view of TCO ensures that purchasing decisions are not just based on upfront costs but on the long-term financial implications, leading to more informed, sustainable fleet management strategies.

Learn more on how to better manage your fleet:

• Marketing tips
• Trends
• Sustainability
• Artificial intelligence

ĚÇĐÄVlogspeaks the language of small business operators. Whether you’re looking to modernize your insight and reporting efforts, save on fuel costs or take advantage of the latest GPS tracking technologies, ĚÇĐÄVlogoffers solutions. To learn more about WEX, a dynamic and nimble global organization, please visit our About ĚÇĐÄVlogpage.

Apply for a fleet card today!

Editorial note: This article was originally published on February 21, 2024, and has been updated for this publication.

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Learn why fleet cards are smarter in our white paper, “Skip the credit card: Fleet cards make more dollars and sense“

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Understanding fleet factoring

You might be asking yourself, what is factoring in trucking? Fleet factoring, at its core, is a financial transaction where a business sells its accounts receivable (invoices) to a third party, known as a factoring company, at a discount. In return, the factoring company provides immediate cash, typically covering some of the portion of the invoice. This arrangement accelerates cash flow, granting companies access to much needed capital especially when waiting for customers to pay. This level of flexibility can give businesses an edge over their competitors.

Watch this quick, informative video and learn how fleet factoring helps you keep trucks moving and drivers paid!

However, despite its benefits, trucking factoring can sometimes be misunderstood. One common misconception is that fleet factoring is only suitable for struggling businesses. In reality, fleet factoring can benefit businesses of all sizes, from startups to established enterprises, by offering a flexible financing solution. Understanding and dispelling any misconceptions about factoring is a great first step for businesses looking to optimize their cash flow and streamline their operations.

What is the fleet factoring process?

Step one: Submitting invoices

The factoring process begins with the business submitting its invoices to the factoring company. These invoices represent completed services or delivered goods awaiting payment from the customer.

Step two: Verification and approval

The factoring company then verifies the validity of the invoices and assesses the creditworthiness of the business’s customers. Once approved, funds are distributed to the business, usually within 24 to 48 hours.

Step three: Customer payment

Customers remit payments directly to the factoring company, which then deducts a factoring fee and any previously advanced funds before remitting the remaining balance back to the business.

Benefits of fleet factoring: How it can upscale business operations

Improving cash flow management

Fleet factoring can streamline cash flow by converting accounts receivables into immediate cash, enabling businesses to meet operational expenses, invest in growth opportunities, and pursue new initiatives without the burden of waiting for a payment.

Mitigating credit risks

By outsourcing the action of credit risk assessment and collections to the factoring company, you can avoid the risk of non-payment and bad debt. This allows your business to focus on your core operations while protecting against the financial consequences of customer defaults.

Better working capital

Access to consistent and predictable cash flow can boost a business’s working capital. Whether it’s funding projects, upgrading equipment, or investing in higher value suppliers and vendors, fleet factoring provides the liquidity necessary to enable strategic growth.

Supporting business scalability and flexibility

Unlike traditional financing options, fleet factoring is scalable and flexible. It accommodates the fluctuations that come with running a business, such as order volume or seasonal demand. Whether your company is experiencing rapid growth or a temporary downturn, factoring can adapt to meet business needs without requiring any long-term commitments.

Alleviating the administrative burden

Factoring companies assume responsibility for invoice processing, credit monitoring, and collections, alleviating some of the administrative burden on businesses. This allows you to redirect your resources towards important business activities, such as customer acquisition, enhancing your services, and marketing initiatives.

Consider ĚÇĐÄVlogCapital to meet your fleet factoring needs

ĚÇĐÄVlogCapital specializes in expediting your payments and protecting your fleet against revenue losses. Tailored factoring programs are designed to seamlessly align with your business needs, ensuring uninterrupted operations and optimal cash flow management.

ĚÇĐÄVlogCapital offers a range of benefits that can simplify your financial operations:

• Same-day funding: ĚÇĐÄVlogCapital gives you access to your accounts receivable within 24 hours. Factoring is not a loan, and no banks are involved—the money you receive is already owed to you.
• Cost effective solutions: ĚÇĐÄVlogCapital offers competitive rates with no hidden fees, no monthly minimums, and no limits on the amount of funding ĚÇĐÄVlogcan provide.
• Reliable service: With 30+ of experience in trucking finance, WEX is the trusted industry leader. ĚÇĐÄVlogoffers outstanding support, including free credit analysis and a dedicated representative. Application and set-up is easy, and you’ll get 24/7 online account access.
• Factoring-funded fuel card: The factoring-funded fuel card is one of the most popular programs in the fleet marketplace. With the Fleet One EDGE card, you have access to a nationwide discount network – save on fuel, tires, wireless plans, maintenance, parts, hotels, and much more. Funds come in from your factored invoice and go directly into your fuel card account. 
• Flexibility: Representatives can make recommendations based on your needs, factoring as many or as few of your invoices from all types of customers, including brokers, shippers, and freight forwarders.

As you continue to look for ways to improve and grow your business, fleet factoring remains a key tool for financial stability and flexibility, helping trucking companies nationwide thrive and grow.

Learn more on how to better manage your over-the-road fleet:

• Fuel card FAQs
• Fraud prevention
• Safety tips
• Tax prep

ĚÇĐÄVlogis a leading, global fintech solutions provider, simplifying payments and back-end business processes in the fleet management, benefits management, and corporate payments areas. To learn more, please visit the company’s About ĚÇĐÄVlogpage.

Editorial note: This article was originally published on August 20, 2024, and has been updated for this publication.

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Tax deductions if you have a fleet of commercial vehicles

Are you a small or large business owner with commercial vehicles, or a fleet manager? Are you just getting your business started, or a seasoned business owner looking to grow your business? Calculating your commercial vehicle spend and how it will be impacted at tax time, including mileage and leasing, can make a huge difference in your overall expenses. Rather than taking the traditional vehicle depreciation over time, business owners and fleet managers can now take immediate deductions during tax season.

If your business purchases a vehicle(s) or truck(s) in 2025, tax codes may allow you to get your total tax break up front instead of spreading the deduction out over the life of your vehicle or asset. Talk to your tax advisor about the options available to your business.

What are the differences between Section 179 and bonus depreciation?

The permanently reinstated 100% bonus depreciation, as initially created by the Tax Cuts and Jobs Act (TCJA), for vehicles purchased and placed in service after January 19, 2025. 

A transitional election permits taxpayers to apply 40% or 60% bonus depreciation on vehicles purchased and placed in service after January 19, 2025.

For vehicles placed in service between January 1, 2025, and January 19, 2025, the bonus percentage is 40%. You report these purchases to the IRS on Form 4562.

Section 179 limits the annual deduction you can take. For 2025, . Whereas, bonus depreciation has no annual limit on the amount of deduction you can take.

Section 179 deductions are also limited by how much your business made during the tax year.  A business can’t deduct more money than it made. Bonus depreciation does not have this limit.

Section 179 allows taxpayers to deduct a set dollar amount. With bonus depreciation taxpayers deduct a percentage (100%). 

Section 179: main points and limitations

• There is a yearly deduction limit of $2,500,000 under Section 179. 
• Businesses must show a profit or positive income at the end of the year.
• Vehicles must be purchased and serve your business before December 31st.
• For heavy SUVs, pick-ups and vans they must be over 6000 lbs. in gross vehicle weight (GVW) to qualify. To determine weight, the IRS looks at the Gross Vehicle Weight Rating, typically on the driver’s door jamb. 
• There is a deduction Cap for Heavy SUVs: $31,300 for 2025 if over 6,000 lbs.
• For vehicles over 14,000 pounds, 100% of the purchase price may be deducted rather than being subject to the limitations assigned to IRS section 179 vehicles.
• Vehicles or fleet trucks and vans must be used for more than 50% of your business activity.
• Used vehicles may qualify, they just must be new to you.

For more information, please consult your Tax Advisor(s) and .

Bonus Depreciation: main points and limitations

Businesses can take advantage of tax savings when bonus depreciation is taken into account. What bonus depreciation allows you to do is deduct the cost of your commercial vehicles from your taxable income. Here are some important points to consider:

• There is no maximum amount, and no limit on purchases. You can deduct your entire asset or vehicle fleet regardless of how much you paid for the vehicles.
• Bonus Depreciation is at 100% for 2025.
• Businesses do not have to show positive income.
• The vehicle(s) you include must be driven for at least 50% of the time for business purposes.
• The vehicle must be used within the United States.
• The vehicle cannot be used for hire, like a car rental service.
• The taxpayer claiming the deductions must be the owner of the vehicle.
• Delivery vehicles qualify.
• Specialty-use vehicles qualify.

Bonus depreciation is reported on . 

Your business commercial vehicle fleet or work vehicles with limited personal use can qualify. Examples are delivery vehicles, including cargo vans, and box trucks without passenger seats, and specialty vehicles like an ambulance or a hearse. Vehicles can be new or used and can be financed by the dealership or bank.

Benefits of using bonus depreciation

Unlike Section 179, with bonus depreciation there is no cap. You can deduct the entire amount of your vehicle purchases without limitation. On top of that, with bonus depreciation there is no restriction based on your annual business income.

You may be able to use both Section 179 and bonus depreciation in the same year – consult your tax professional for more information.

Vehicle write-offs:

If the taxpayer doesn’t claim bonus depreciation, the greatest allowable depreciation deduction is:

• $12,200 for the first year,
• $19,600 for the second year,
• $11,800 for the third year, and
• $7,060 for each later taxable year in the recovery period.

If a taxpayer claims 100% bonus depreciation, the greatest allowable depreciation deduction is:

• $20,200 for the first year,
• $19,600 for the second year,
• $11,800 for the third year, and
• $7,060 for each later taxable year in the recovery period.

Fleet commercial vehicle expenses for tax deductions

Understanding the best way to expense the vehicles in your small or large business fleet can mean significant savings in taxes. In addition to vehicle depreciation, it is important to consider mileage deduction and buying vs. leasing when looking at overall tax savings for your business.

Keeping good records, including business mileage and other expenses, is essential for any business taking tax deductions. You can decide whether to use the standard mileage rate or actual costs to get the best advantage. As a general rule, the standard rate makes the most sense for economical vehicles whereas the actual cost is preferred if there are high operating expenses (repairs, tires, gas, etc.).

Mileage deductions on your fleet of commercial vehicles: standard rate vs. actual costs

For the 2025 tax year, the standard mileage rate is 70 cents per mile for employees and self-employed individuals. It is important to keep a record of the total number of miles driven over the year, and the total miles driven just for business purposes. Keeping a written log of mileage used for business daily or downloading a mileage app on your smartphone are easy ways to track your miles. Fleet cards can make it easy to keep track of mileage, too.

Some other vehicle deductions that may qualify include turnpike tolls, parking fees, registration fees, and auto loan interest. 

Deduction for depreciation or “wear and tear” on your fleet

Whether you are self-employed or an employee, you may be able to take a deduction for the wear and tear on vehicles. 

Most businesses will allow employees who use their personal vehicle for work purposes to submit a reimbursement request form that itemizes their expenses. This will require comprehensive record-keeping by your drivers. Refer to the section of their site for more details.

Special considerations for leasing a commercial vehicle for your fleet

If you lease a vehicle and use it solely for work purposes, the lease payment can be deducted from your taxable income when you calculate your taxes at year’s end. If you lease a vehicle and use it for both personal and business purposes, the business portion/payment of the lease payment can be deducted but the time spent in the vehicle for personal use cannot.

There is also an income inclusion rule to even out the tax benefits between leasing and owning. If the fair market value (FMV) of a leased vehicle is above a certain amount, the lessee may have to report additional income. This usually only affects those who have leased luxury vehicles and is designed to limit the tax benefits for expensive cars. The amount of your car expense that can be deducted will, of course, depend on how much your vehicle or truck is used for business. A fee or “inclusion amount” is a fixed dollar amount issued by the IRS that will reduce the amount you can deduct, in some cases. See IRS Publication 463, Travel, Gift, and Car Expenses.

The big picture: your total commercial vehicle fleet costs

If you’re a fleet manager or business owner with more than one vehicle or truck, your fleet management costs can make up a large portion of your operating budget. From licenses and permits to monthly payments and depreciation, the ongoing costs can have a huge impact on your overall bottom line. Other indirect costs like fuel, parts replacement, regular maintenance, parking fees, and tolls, can add up quickly.

The ability to capitalize on these direct and indirect vehicle and fleet expenses can mean large savings at tax time. In addition, by looking at the “big picture”  with a trusted tax consultant, you can figure out ways to increase your fleet efficiency during the year. From managing your fuel expenses with a fleet card to examining your yearly maintenance costs, you can begin to proactively plan for the upcoming year’s expenses.

Federal government tax incentives can also help you right-size your fleet to ensure the best use of every truck or vehicle you have on the road. Are they all working to your best advantage or are some under-utilized and only an added expense? Looking at the big picture of your fleet management cost every year will help you streamline your small business operations and expenses.

Closing out 2025 and making the most of your tax deductions

Whether you are a business manager or owner, self-employed and working on your own, or a fleet management company, the way you expense your work vehicle(s) or truck(s) can make a huge difference when filing your taxes. To use the Section 179 deduction and bonus depreciation to lower your tax bill, any vehicle purchases must have been finalized before the end of the calendar year, and you must have used that vehicle during 2025.

Making the most of your vehicle or fleet expenses, including mileage and leasing, can help your new business get off to a great start, or help a seasoned business grow and thrive. Rather than taking the traditional vehicle depreciation over time, business owners can now take an immediate deduction.

Whether you need to increase the number of vehicles in your fleet or buy a new or pre-owned commercial truck for yourself, the advantages of making these purchases before the end of the year can be beneficial at tax filing time.

This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, tax, legal or accounting advice. You should consult your tax, legal and accounting advisors before engaging in any transaction.

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Editorial note: This article was originally published on December 11, 2020, and has been updated for this publication.

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