Sunday, June 22, 2008


I don't like "fuel surcharges." Companies should just raise their prices and explain why, instead of tacking on an additional temporary-seeming charges, but this is just dumb.

But last week, PCS added a new 7 cents per mile "surcharge" to its price structure. Once again, this was misleading advertising - drivers are now paying 16 cents per mile for service, as the "surcharge" was simply added to the 9 cents a mile that PCS customers were already paying. Naturally, PCS justified this sudden 78 percent markup as a necessary response to gasoline prices that now exceed $4 a gallon.

The math, however, tells a different story.

Pooling all the data on PCS's Web site (www. regarding its fleet and averaging each car's city and highway miles-per-gallon ratings, it turns out that the average PCS car gets 39.85 miles per gallon. This impressive figure is the result of the large number of Toyota Priuses in PCS's fleet - hybrid cars that, according to PCS's Web site, get 51 to 60 miles per gallon. With gasoline at $4.10 a gallon, it appears that the average cost of driving all of PCS's cars is about 10.3 cents per mile - again, less than PCS's new prices.

A per-mile charge covers more than fuel, obviously. No such cost could perfectly cover the exact per-mile marginal cost of driving a mile, of course, but the implicit cost of driving a mile has involves more than just gas. And the 9 cents per mile price has for some time been even lower than the actual price of gas.