VTA cost index shows uneven rise

VTA boss urges members to lose no time in passing on increasing costs of doing business

December 13, 2011

The cost of doing business in the transport sector continues to rise at varying rates, according to Victorian Transport Association (VTA) analysis.

The Association’s December 2011 Cost Index, the full details of which are available only to members, showed a rise of 3.18 percent

Higher government costs and charges and fuel price rises meant margins were being squeezed, VTA CEO Philip Lovel says.

Lovel kept up his unceasing call or members to seek full cost recovery, saying that "it is vital that they act immediately".

"Obviously, labour is a key increase adding 1.75 percent to the index," Lovel says.

"Rising labour costs will continue to put pressure on overall transport costs in the future.

Interest rates and vehicle capital costs dropped slightly.

"Fuel increases continued to increase and are now at pre GFC prices."

This was an increase of 16.73 percent over the 12 month period.

"Margins are quickly disappearing with National Registration Charges increasing and the Diesel Fuel Credit reducing every 12 months".

"The diesel fuel credit started at 18.51cpl and is now down to 15.043 cpl – a drop of 3.47cpl or 18.73 percent over the past four years."

"Our customers must accept cost increases are passed on or they will find more transport companies disappearing or reducing services.

"This fact is real and in the end the customers will be the losers."

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