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Werner Enterprises has achieved more than 70% of a targeted savings goal since the third quarter and plans to find more reductions, executives said in earnings call November 1.
The carrier projected it would achieve $43 million in annual savings through the cost-savings program, which calls for a shift to more in-house maintenance, among other measures, EVP, CFO and Treasurer Chris Wikoff said on the call.
To help manage costs, it invests in new equipment to run older trucks. A year ago, Werner had more than 500 trucks that each had more than 400,000 miles, but the number of those long-haul trucks is down to 50, CEO, President and Chairman Derek Leathers told investors.
“We’re still working more aggressively on in-house maintenance, the quality of that maintenance, but also the fresher fleet gives us a really good start on that,” Leathers said.
Supplies and maintenance costs were $60.1 million in the third quarter, down $7.8 million from the same period last year.
The decrease was due to lower costs for on-road tractor maintenance, tires and the impact of 3.4 million fewer tractor company miles,” the carrier said in earnings report filed on Wednesday.
Werner reduces maintenance, supplies the line item
Quarterly costs in a subcategory of operations for the carrier from 2021 to present.
“We’ve certainly gone past the midterms on some of the procurement and maintenance initiatives,” Leathers said. “But there is still room for growth.”
The carrier also said it is developing digital solutions to further optimize the routing and scheduling of tractors and trailers for preventive maintenance, according to the earnings report.
In May, Werner identified annual projected savings of about $34 million, coming from areas such as lower driver turnover and fuel efficiency.
Meanwhile, the carrier cut its company’s truck count to 7,905 at the end of the third quarter, down 5% year-on-year, and prepares for future emissions standards.