How to Work Out Haulage Cost per Mile Without Guesswork

How to work out haulage cost per mile starts with getting your own numbers straight, not guessing off a headline rate. A quick way to sanity check is the free CTS haulage cost calculator, which turns one vehicle and one driver into a clear cost per mile, cost per day and a target rate for margin. It reflects a typical way operators price work, by breaking a single unit down into fixed bills and distance driven costs, then showing what you must charge to stay in the game.

What the CTS calculator does, and who it is for

The model uses one tractor unit with one driver. You enter finance or depreciation, insurance, Vehicle Excise Duty, operator licence and compliance, driver employment cost including salary, National Insurance, pension, holiday and training, plus an overhead share. Then set annual mileage and working days, and the running inputs, MPG, diesel price, tyres, maintenance and tolls. The output is cost per mile and cost per day, with a margin slider that converts cost into a rate you can quote.

It suits owner-drivers, small fleets and transport buyers who need to understand why a rate looks the way it does. If you are sourcing regular work, it also helps frame conversations on contract haulage so both sides are talking about the same cost base.

How to work out haulage cost per mile step by step

Haulage pricing is a sum of standing costs and running costs. Standing costs are the annual bills you pay whether the wheels turn or not. Running costs scale with distance, mainly fuel, tyres, maintenance and tolls.

Fuel is calculated per mile as 4.54609 divided by MPG, multiplied by diesel pence per litre, divided by 100. Standing cost per mile is total annual standing cost divided by annual mileage. Total cost per mile is standing plus fuel, tyres, maintenance and tolls. Cost per day is total annual cost divided by working days.

The margin control expresses rate as a share of revenue. The rate per mile equals cost per mile divided by one minus margin. For example, a 15 percent margin on a £1.50 cost gives a £1.76 rate. That gap creates your target profit margin; risk and downtime still need to be allowed for in your costs.

The model excludes VAT, separate trailer costs and any empty running beyond what your mileage already reflects. Operator licence and compliance are treated as real standing costs, as set out in the gov.uk goods vehicle operator licensing guide, and they belong in your numbers every time.

Putting your own figures into the calculator

1. Enter finance or depreciation, insurance, Vehicle Excise Duty, operator licence and compliance, driver employment cost and your share of overhead.
2. Add utilisation, annual mileage and working days per year.
3. Set fuel inputs, MPG and diesel price in pence per litre.
4. Include tyres, maintenance and any tolls you expect to pay.
5. Move the margin slider to the level you are aiming for.

Be honest with the fixed bills. Operator licence and compliance sit there whether the truck moves or not, so put them in. Driver employment cost is the full package, salary, National Insurance, pension, holiday and training, not just the wage on the advert. Mileage and working days drive everything, so avoid guesswork here. If you overstate utilisation you will flatter your cost per mile and come unstuck later. On fuel, use a current pump price you actually pay and a realistic MPG for your work. General haulage is not the same as heavy urban work or long steady trunking. Tyres and maintenance vary by kit and duty cycle, so use your own records if you have them.

Reading the result before you quote

The outputs give you cost per mile, cost per day and a rate per mile for your chosen margin. Treat the result as a baseline for the unit and assumptions entered, then add any excluded or job-specific costs. It already combines standing costs with running costs, so if your rate sits below it, the job is eating your business. The rate for margin shows what you need to charge so that margin is a share of revenue, not a markup guessed on the day.

Watch how sensitive the standing cost is to mileage. At low utilisation, those fixed costs are spread over fewer miles and the rate climbs quickly. That is why a quiet truck looks cheap on paper until you price real work. The model is for one tractor unit with one driver, so build up from that if you are planning a small fleet. If a quoted rate does not cover standing costs and a fair margin, it will not hold up for long.

Put your own numbers into the calculator and see where your floor really sits at CTS haulage cost calculator. If you would rather test the market, ask CTS to source firm prices from vetted operators at request quotes through CTS.

Frequently asked questions

How do I work out haulage cost per mile for my own truck?

Use a single vehicle model and enter standing costs, running costs, mileage and working days to get cost per mile and cost per day. The calculator then shows the rate per mile needed for a chosen margin.

What costs must be included in cost per mile?

Include finance or depreciation, insurance, Vehicle Excise Duty, operator licence and compliance, driver employment cost and overhead as standing costs, plus fuel, tyres, maintenance and tolls as running costs. Excluding any of these will understate your true cost per mile.

Why does my cost per mile rise when mileage falls?

Standing costs are fixed for the year and are divided by annual mileage, so fewer miles push the cost per mile up. Low utilisation therefore increases the rate you need to charge to cover costs and margin.