Knowing your fleet fuel cost per mile tells you what you are spending, shows you which levers are worth pulling, and gives you a defensible basis for charging a rise back to the customer.
Below we work through the calculation for fleet fuel cost per mile, understand what changes these figures, and set out how to write a surcharge clause that holds up when price changes do come up.
Let's use one worked example all the way through so you can follow the numbers from the formula to the surcharge invoice without rereading anything. Every price here is ex-VAT, as commercial fuel is quoted and invoiced. Swap in your own delivered rate and mpg for your real figures.
| Example figures | |
|---|---|
| Vehicle | 44-tonne artic |
| Fuel economy | 8.3mpg |
| Diesel price (delivered) | 155p a litre, ex-VAT |
| Fleet size and mileage | 10 artics, 75,000 miles each |
| Contract baseline price | 145p a litre, ex-VAT |
| Surcharge trigger band | 5p a litre |
| Linehaul rate | £1.60 a mile, the per-mile rate you charge for trunking |
The baseline sits below the current price on purpose. A baseline is the price your rate was costed on when the contract was signed, not the price today, and the gap between the two is exactly what a surcharge exists to recover.
How to calculate your fleet fuel cost per mile
Multiply your delivered price per litre by 4.546, then divide by the vehicle's miles per gallon. The answer is your fuel cost in pence per mile.
Fuel cost per mile = (price per litre × 4.546) ÷ mpg
The conversion is there because mpg is measured in gallons while you buy and invoice in litres. Skip it, and your cost per mile comes out four and a half times too low.
Look at our example fuel economy figure of 8.3mpg, a figure commonly used in 44-tonne cost modelling, that gives you:
- Diesel at 145p a litre = 79.4p a mile
- Diesel at 155p a litre = 84.9p a mile
- Diesel at 170p a litre = 93.1p a mile
Be sure to use your delivered price per litre, ex-VAT, rather than a national pump average, or every number downstream of it is wrong. You should also calculate it separately for artics, rigids and vans, as a blended fleet average hides the vehicles losing you money.
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What affects your fleet’s per-mile fuel cost most?
From miles per gallon to fuel type, several factors can affect your fleet’s per-mile fuel cost:
- Buying structure: Forecourt diesel carries a retail margin on every litre, and bulk fuel does not. On a fleet using 411,000 litres a year, a few pence a litre is a five-figure swing. Unlike an mpg programme, it lands immediately and depends on nobody changing their habits.
- Miles per gallon: Driver coaching, tyre pressures and aerodynamics typically recover 5% to 10%. That is a real gain, but it arrives slowly, and it is harder to hold than a pricing change.
- Empty running: This one does not change your cost per mile at all. It changes your cost per revenue mile, which is the number you should be pricing against. A truck running 30% empty covers 286 miles to deliver a 200-mile load, so every invoiced mile has to carry 1.43 miles of diesel.
- Fuel type: Gas oil for off-road plant sits at a lower duty point than white diesel. HVO usually costs more per litre, so treat it as a decarbonisation decision you can evidence rather than a saving.
- Losses: Unreconciled tank stock and unsecured bowsers inflate your pence per mile without ever appearing on an invoice.
How to calculate a fuel surcharge
To calculate a fuel surcharge, run the cost-per-mile formula twice, once at your contract baseline price and once at the current published index price, then charge the difference.
Working from the example figures above, now at 163p a litre:
- Fuel cost per mile at baseline: 145 × 4.546 ÷ 8.3 = 79.4p.
- That 163p is 18p above baseline and clears the third 5p band, so the clause fires and recalculates on the published price.
- Fuel cost per mile at 163p: 163 × 4.546 ÷ 8.3 = 89.3p.
- Surcharge due: 9.9p a mile, or 6.2% of linehaul.
On 750,000 fleet miles, leaving that 9.9p unrecovered costs you roughly £74,000. The RHA Haulage Cost Movement 2025 survey put operating costs excluding fuel up 5.91% year on year, with sector margins sitting around 2%. At those margins, a clause that never fires costs you the whole year's profit.
What should a fuel surcharge clause include?
A fuel surcharge clause should include four things: a baseline price, a published index, an assumed mpg, and a trigger band. The clause fails if any one of them is left vague.
- A baseline price per litre: The figure your rate was costed on, written into the contract.
- A published index: The Department for Energy Security and Net Zero weekly road fuel prices series, or the RHA's weekly national average bulk diesel price. Never your own invoices, because your customer cannot audit those.
- An assumed mpg: Agreed, stated, and applied consistently in both directions.
- A trigger and review period: Typically a band of 3p to 5p a litre above or below baseline, reviewed weekly or monthly.
Name the index, the publication day and the effective date. Ambiguity on any of those is where surcharge disputes start.
How to build a fleet fuel budget
If you want to build a fleet fuel budget, forecast the litres first, then price them under three scenarios.
Step one: Forecast litres
- Ten artics covering 75,000 miles each gives you 750,000 miles.
- Divide by 8.3mpg for 90,361 gallons, then multiply by 4.546 for 410,783 litres.
- Round up and budget for 411,000 litres.
Step two: Price three separate scenarios
| Price per litre (ex-VAT) | Annual fuel cost |
|---|---|
| 140p | £575,000 |
| 155p | £637,000 |
| 170p | £699,000 |
The 30p a litre gap between the low and high case is £123,300 across 411,000 litres. That is your exposure for the financial year, and it is the number your rates have to be able to absorb. Reforecast litres quarterly when mileage or fleet mix changes.
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