A recent survey by the road transport body has reinforced the pain operators have been feeling for some time now, caused by unsustainable fuel costs.
An economic viability pulse check commissioned by the National Road Transport Association (NatRoad) has revealed the sky-high price of diesel fuel is the number-one concern for the country’s heavy vehicle operators.
Some 93 per cent of operators identified fuel prices as “very important” or “important” when evaluating their biggest pain point.
Almost six-in-ten say complying with regulation rates as “important” (32 per cent) or “very important” (37 per cent), and labour costs are a “very important” or “important” issue for 59 per cent of firms.
NatRoad CEO Warren Clark says his organisation commissioned the work by economists HoustonKemp Economists last year to establish what factors are determining viability and how companies can be more successful.
The research canvassed the views of 169 firms, most but not all of them NatRoad members, and was sponsored by Ampol.
More than half of the respondents employ fewer than ten drivers and earn revenue of less than $2 million per annum.
“These people are the heart and soul of our industry and their views count,” Clark says.
“We hear a lot about economic viability so we wanted to use economists to define exactly what it means and where we are going.”
Clark says it was no surprise that the high cost of fuel is the top worry for so many businesses.
“The HoustonKemp analysis shows fuel costs increased by 45 per cent in 2021-22 with a sharp spike from March 2022,” he says.
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“Diesel prices in 2022-23 so far are higher than those observed in 2021-22 and are likely to be even higher in 2022-23.
“This is an issue that is driven by global factors and isn’t going away soon. Governments can’t fix it but they can consider the burden it imposes to what is an essential service and look to provide relief elsewhere.”
Brent Merrick, Ampol Executive General Manager, International and New Business, says Ampol will continue to support transport businesses as they navigate industry challenges.
“We understand that fuel is a significant expense for many transport businesses and that rising costs remain a challenge across the freight sector,” Merrick says.
“We continue to work with NatRoad to deliver fuel savings to member businesses, acknowledging that fuel prices are largely determined by global markets.”
The study examined labour costs between 2015- 16 and 2021-22 to run a 9-axle B-double travelling 250,000 km per year. It found they had been relatively stable, with yearly changes ranging from between 1.7 per cent and 3.5 per cent.
NatRoad says labour costs are expected to increase by five percent in 2022-23, however, due to an increase in the award wage and a rise in the superannuation rate.