Fuel Cost and Strategy for FedEx Ground Routes
Fuel is one of the most significant operating expenses for FedEx Ground contractors—often second only to payroll. Whether you operate a fleet of pickup and delivery (P&D) trucks or linehaul tractors, optimizing your fuel costs directly impacts your bottom line.
In this blog, we’ll break down what you need to know about managing fuel in a FedEx route business, how to reduce expenses, and why having a fuel strategy is just as important as hiring the right drivers.
Why Fuel Strategy Matters in FedEx Operations
For FedEx contractors, route profitability depends heavily on operational efficiency. Fuel consumption is a constant cost that can either drag down margins or create savings, depending on how well it’s managed.
Unlike some other route businesses, FedEx contractors:
Must supply their own fuel
Are not reimbursed by FedEx for fuel costs
Face daily fuel usage across multiple vehicles and routes
Because of this, fuel strategy is not optional—it’s a core part of running a profitable logistics operation.
Average Fuel Spend for FedEx Contractors
Fuel typically represents 8 to 15 percent of total revenue, depending on:
Route density and length
Type and age of fleet vehicles
Region and local fuel prices
Driving habits and idle time
Contractors running older trucks or long-distance routes can see this number climb significantly higher.
Tips to Reduce Fuel Expenses
1. Upgrade to Fuel-Efficient Vehicles
Fuel efficiency varies widely by truck type. Investing in newer vehicles, especially those with better fuel mileage or alternative fuel options (like CNG or electric), can offer long-term savings.
2. Use a Fleet Fuel Card
A dedicated fuel card allows contractors to:
Access bulk discounts
Track fuel purchases by driver or vehicle
Identify outliers and misuse
Streamline accounting and reconciliation
Programs like the RCPA Fuel Card are tailored specifically for FedEx contractors, offering negotiated rates and reporting tools that integrate with your operation.
3. Monitor Driving Behavior
Aggressive driving, excessive idling, and poor routing decisions can all waste fuel. Telematics tools allow you to monitor driver behavior, optimize routes, and reward efficiency.
4. Track Fuel Spend by Truck
Maintaining vehicle-level tracking helps identify which trucks are costing the most to operate. This can inform decisions about replacements, maintenance schedules, and leasing strategy.
P&D vs. Linehaul Fuel Considerations
Fuel strategy varies based on the type of operation:
P&D Routes (short distance, stop-start driving): Focus on fuel-efficient step vans, route optimization, and avoiding idle time during deliveries.
Linehaul Routes (long distance, highway driving): Fuel cost becomes a larger percentage of expenses, making fleet fuel programs and MPG improvements more impactful.
Final Thoughts
Fuel is a daily reality for every FedEx contractor. But without a proactive strategy, it’s easy to let this cost erode profitability. By tracking consumption, investing in efficient equipment, and using tools like fuel cards and telematics, route owners can turn fuel management into a competitive advantage.
At Route Consultant, we help contractors understand the full picture of operating expenses—including how to control fuel costs from day one. Whether you're buying your first route or managing a fleet of 20 trucks, a fuel strategy is essential to long-term success. Ready to take the next step? Browse Available Routes for Sale.
Want to Learn More?
For a comprehensive understanding of FedEx Ground routes, consider enrolling in our FedEx Ground Routes 101 Course. This course provides foundational knowledge to help you decide if investing in logistics routes aligns with your goals.
