How to Calculate per Mile Rate

Trucking Cost Per Mile Calculator

Total distance traveled (including deadhead miles).

Your Operating Cost Per Mile

$0.00

function calculateCPM() { var fixed = parseFloat(document.getElementById('fixedCosts').value); var variable = parseFloat(document.getElementById('variableCosts').value); var miles = parseFloat(document.getElementById('milesDriven').value); var resultDiv = document.getElementById('cpmResult'); var resultValue = document.getElementById('cpmValue'); var breakdown = document.getElementById('breakdownText'); if (isNaN(fixed) || isNaN(variable) || isNaN(miles) || miles <= 0) { alert("Please enter valid numbers for costs and miles (miles must be greater than 0)."); return; } var totalCosts = fixed + variable; var cpm = totalCosts / miles; var fixedCPM = fixed / miles; var variableCPM = variable / miles; resultValue.innerText = "$" + cpm.toFixed(2); breakdown.innerHTML = "Fixed Cost: $" + fixedCPM.toFixed(2) + " per mileVariable Cost: $" + variableCPM.toFixed(2) + " per mile"; resultDiv.style.display = 'block'; }

In the logistics and trucking industry, knowing your cost per mile (CPM) is the difference between a thriving business and filing for bankruptcy. If you don't know exactly what it costs to move your truck one single mile, you cannot accurately price your freight or negotiate with brokers.

The Importance of Cost Per Mile

Calculating your per mile rate allows you to identify your "break-even point." This is the minimum amount you must charge to cover all expenses before making a single penny in profit. For owner-operators, this calculation reveals whether a load is worth taking or if the deadhead miles will result in a net loss.

Step 1: Identify Your Fixed Costs

Fixed costs are expenses that you must pay regardless of whether the truck is moving or sitting in the driveway. These remain constant month-to-month. Common fixed costs include:

• Truck Lease or Loan Payments
• Insurance Premiums (Liability, Cargo, Physical Damage)
• Permits and Licensing (IFTA, ELD subscriptions)
• Professional Fees (Accounting, Legal)

Step 2: Identify Your Variable Costs

Variable costs fluctuate based on how much you drive. The more miles you put on the odometer, the higher these costs will be. These typically include:

• Fuel: Your largest variable expense.
• Maintenance: Tires, oil changes, and unexpected repairs.
• Tolls: Varying by route.
• Driver Wages: If you pay yourself or an employee per mile.

The Formula

(Total Fixed Costs + Total Variable Costs) / Total Miles Driven = Cost Per Mile

Realistic Example Calculation

Let's look at a typical month for an owner-operator:

• Fixed Costs: $2,500 (Truck payment + Insurance)
• Variable Costs: $4,800 (Fuel + Maintenance + Food)
• Total Monthly Miles: 8,000 miles

Total Costs: $2,500 + $4,800 = $7,300
Cost Per Mile: $7,300 / 8,000 = $0.91 per mile

In this scenario, if a broker offers you a load at $1.50 per mile, your profit margin is $0.59 per mile ($1.50 – $0.91). If they offer $0.85 per mile, you are losing money on every mile driven.

Strategies to Improve Your Per Mile Rate

To increase your profitability, you have two primary levers: reduce your expenses or increase your efficiency. Reducing deadhead miles (miles driven with an empty trailer) is the most effective way to lower your per-mile operating cost, as it spreads your fixed costs over a larger number of revenue-generating miles.