Rising Repair Costs, EV Complexity, and Their Implications for the Trucking Industry in 2025
As the trucking industry gears up for 2025, it faces a challenging landscape shaped by rising repair costs, the increasing prevalence of electric vehicles (EVs), and technological advancements. According to CCC Intelligent Solutions Inc.’s latest Crash Course Q3 2024 Report, these trends will significantly impact both auto insurers and repairers, as well as the trucking sector.
The report analyzes data from 300 million claims-related transactions and millions of personal injury and medical payments claims processed through CCC’s cloud platform. It reveals that the total cost of repair (TCOR) surged by 3.7 percent in the first half of 2024 compared to the same period in 2023, largely due to increased labor and parts costs. Labor rates alone saw a 4.9 percent increase year-over-year, putting additional financial pressure on repair facilities, including those that service commercial vehicles in the trucking industry.
With the rise of EVs, the complexity of vehicle repairs has escalated. In the first half of 2024, EVs accounted for 2.4 percent of all repairable claims, up from 1.6 percent in 2023. This shift presents unique challenges for the trucking industry, particularly as fleet operators begin integrating electric trucks into their lineups. The average repair cost for an EV is 46.9 percent higher than for non-EVs, a disparity that could affect operational budgets and insurance premiums for trucking companies adopting electric models.
Labor is a significant component of repair expenses, comprising 43.3 percent of total costs for EVs that are three years old or newer, compared to 36.5 percent for conventional vehicles. As the trucking industry explores electric fleets, it must contend with these heightened labor costs and the need for specialized skills in maintaining advanced EV technology.
Persistent inflation continues to strain the industry, with casualty claim costs on the rise. Third-party medical bill severity increased by 5.4 percent, while first-party medical bills jumped by 6.1 percent since the first half of 2023. These rising costs, coupled with increased claims from uninsured and underinsured motorists, signal potential challenges for trucking companies in managing risk and insurance expenses.
The report also highlights a 1.8 percent year-over-year increase in vehicles flagged as total losses in 2024, a trend that could extend to commercial fleets as vehicle values continue to decline and the average age of vehicles on the road increases. Currently, 73 percent of valuations pertain to vehicles seven years or older, underscoring the aging nature of the U.S. vehicle fleet, which includes many heavy-duty trucks.
“2025 will bring distinct challenges and opportunities for both the auto and trucking industries,” says Kyle Krumlauf, director of industry analytics at CCC. “With rising repair costs, labor shortages, and the complexities introduced by electric vehicles, it’s crucial for trucking companies to stay ahead of these trends. Our Q3 report outlines insights and strategies that can help the trucking industry navigate these challenges and thrive in an increasingly competitive market.”
As the trucking industry evolves, addressing these issues proactively will be key to ensuring sustainable growth and operational efficiency in the years ahead.
Cook Insurance Group: Your Partner in Trucking Insurance
With over 20 years of experience in the trucking insurance industry, Cook Insurance Group offers unparalleled service and expertise. Serving large fleets, small fleets, single-owner operators, tow trucking operations, and charter bus lines, we focus exclusively on the trucking industry to provide the best insurance solutions. Our friendly, bilingual staff is dedicated to helping you find the right insurance protection at the right cost.
At Cook Insurance Group, we tailor our services to meet the specific needs of both small and large fleet trucking companies. Our representatives manage every aspect of your insurance program, ensuring you have the best plan for your unique needs. We offer immediate certificate and ID card issuance, 24/7 certificate availability, and a client portal for easy access to certificates, claim status, and policy details.
Our prompt and reliable service includes 24-hour claims reporting for physical damage and motor truck cargo.We also provide educational seminars for management and drivers, licensed risk managers to assist with CSA scores and driver training, border risk coverage (NAFTA), and mid-year loss run reviews. Whether you are located in Texas, Arizona, or Arkansas, choose Cook Insurance Group for all your trucking insurance needs.
Choose Cook Insurance Group for all of your trucking insurance needs whether you are located in Texas, Arizona or Arkansas.