5 Key Things to Know: FedEx P&D | Paradiso Insurance

If you want to run a FedEx Ground P&D Routes business but don’t know anything about vehicles for commercial pickup and delivery, then starting out may seem challenging.

However, by the end of this guide, you’ll have the basics covered to make the decisions a no-brainer. That said, let’s start:

FedEx Requirements for P&D Vehicles:

  • The color should be white with FedEx Contractor Name and DOT Number.
  • All doors should have locks
  • Depending on the vehicle type, some specific dimension requirements should be met.
  • Should have a VEDR (Video Event Data Recorder)
  • If you choose brand promotion, then there will be FedEx Ground decals as per the brand specifications.
  • Depending on the vehicle type, some specific shelving requirements should be met to secure packages during transit.

Tips for Choosing the Right P&D Vehicle:

  • For longer distance routes, use diesel
  • Older vehicles will require more money in maintenance and repairs; go for new ones
  • Add maximum safety equipment 
  • For high volume stops, go for step vans
  • Don’t go for cutaway gas vans as they increase inefficiency

P&D Vehicle Maintenance Costs:

The commercial P&D vehicles are stressed out A LOT more than regular cars, so it makes sense that their maintenance costs are also higher. These vehicles are driven hundreds of miles every day; their doors are opened and closed hundreds of times every day, and they carry so much load over several miles.

All of these things cause more load on all of their parts, and as a result, more money is needed to repair or maintain them than regular vehicles.

If you use Step Vans, then the maintenance costs may fall between  $8,000 and $12,000 per year. However, if you use cheap regular or cutaway vans, you can expect to pay even more than this in maintenance costs.

P&D Vehicle Life:

Commercial trucks can go up to 300k miles before needing repairs. But if we talk about gas vans, you can expect major repairs after about 100k miles and costly engine replacements after crossing 150k miles. The cost for engine replacement can go well above $10k. 

Other repairs like rebuilds and transmission replacement may cut you back by $6k+. 

For diesel vehicles, you can expect a rebuild after it racks up over 200k miles. The cost can be over $12k if a rebuild is necessary.

Because of these hefty maintenance and repair costs, we always suggest P&D contractors follow a strict replacement schedule because driving an old vehicle will cost you a lot more than replacing it with a new one. Here’s that schedule:

  • Drive the diesel step vans for up to 400,000 miles or for 4-5 years with one rebuild.
  • Gas step vans should be replaced after they are 4-5 years old or have reached 400k mileage with up to two engine replacements.
  • For regular vans and gas cutaways, replace them before reaching 150k miles

Do not purchase any vehicles that are past these thresholds when starting out with your P&D business. Always go for a new van.

P&D Vehicle Costs:

If you go for new P&D vehicles, keep in mind they can be a little expensive. However, you don’t have any choice but to go for new ones as old vans may cost you a lot more in the long run in terms of repairs and maintenance. Below are some general costs of P&D Vehicles (new):

  • P700-P1200 Gas Step Vans could cost from $50,000 to $65,000
  • P700-P1200 Diesel Step Vans could cost from $60,000 to $75,000
  • Regular Vans from $38,000 – $42,000
  • Cutaway Vans from $40,000 to $45,000

If you’re investing so much money in a new van, it is extremely crucial to have FedEx parcel delivery insurance. In case there is any physical or mechanical damage to the Van(s), your investment will be protected.

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