Remember when Covid first hit early last year and everybody stopped driving to the office? Oil and gas reserves increased and consequently prices dropped. That was the good news, but prices didn’t remain lower for long. Our supplier actually called us and warned us about the impending increases for 2021.
With many industries, the Oil industry passes along their increases at the beginning of the year. As a truck repair facility it’s good practice for us to look at a supplier increase and absorb a portion of the increase if possible rather than passing on the entire increase to our customer. This year however has been unprecedented as the oil suppliers continue to announce increases, three so far this year and more expected.
When we see price increases we begin to shop around to be sure we are doing the best we can for IE Fleet customers. We will not however compromise quality for price, our customer will always receive manufacturer recommended products from IE Fleet. In some instances shopping around has paid off, we’ve been able to keep our prices the same thereby passing that savings on to the customer.
So what has been driving the price increases? Here’s what the manufacturers are telling us:
- Rising price of crude oil.
- Tight supply of base oil (manufacturers cut back on production).
- Ice storm in the Gulf Area February 2021.
- Covid (of course!).
- The economy bounces back, V shaped recovery drives demand up.
And the list goes on to include packaging, freight , insurance and all the common increases every business typically experiences. The moral here is to anticipate a cost increase when you bring your vehicle in for service, knowing your service provider can not absorb each and every increase.
For more information give us a call – 909270-4328.