ATA CONVENTION: Credit squeeze gets worse

More and more trucking operators struggle to remain viable, as demand slows and banks refuse to lend money

By Brad Gardner

More and more trucking operators are struggling to remain viable, as demand slows and banks refuse to lend money in the face of declining economic conditions.

In a survey completed by 139 trucking operators, 62 percent of respondents recorded negative or no growth in revenue during the last six months, while the same number expected a similar result during the next six months.

The survey, conducted by the Australian Trucking Association (ATA) during March and April, also found as much as 38 percent of those surveyed found it hard to secure finance.

A spokesman for the ATA says companies are finding it hard to gain finance because banks are imposing more stringent lending conditions such as extra paperwork and higher interest rates.

This prompted 67 percent of respondents to claim they will find it hard to gain finance in the next six months, as Australia officially enters recession.

In his address to the 2009 Australian Trucking Convention on the Gold Coast today, ATA Chairman Trevor Martyn told delegates the peak trucking lobby will focus on working with government to reduce the impact of the recession on the industry.

"In 2009, one of the ATA’s key tasks will be to continue arguing for policy measures that will help support the economy, trucking operators and the jobs of our employees," Martyn says.

His comments follow a recent meeting with Minister for Small Business Craig Emerson, where the ATA raised concerns over the industry’s inability to gain finance.

During his speech, Martyn commented on the "remarkable 12 months" since the last ATA Convention in Canberra in 2008.

"When we last met, it was though that inflation was the greatest problem facing the country. Many people thought Australia’s long economic boom would go on forever," Martyn says.

Despite the economic gloom, Martyn says the Rudd Government’s investment in road and rail projects and the introduction of the 30 percent tax deduction for companies purchasing new equipment will help.

In his welcoming address, Martyn also reiterated the ATA’s "important victory on heavy vehicle charges", after it managed to convince the Senate last year to block government efforts to index the road user charge.

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