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Road Haulage Association concerned over rising fuel costs

By: Deborah Bates
16 December 2010

The Road Haulage Association (RHA) is worried about the rising costs of fuel, particularly diesel and is concerned that haulage firms will not be able to cope with the extra costs, reports

"We are almost back to the all-time peak level of 2008," warns the director of policy at the RHA, Jack Semple. "Diesel accounts for a third of a haulier's costs and these increases further threaten the viability of firms who have been caught in a perfect storm of rising prices, reduced credit terms and a credit squeeze, often made worse by customers taking longer to pay their bills."

"On top of all that, in the past couple of weeks, many hauliers have faced an additional business risk; the greatly reduced productivity and increased costs resulting from the appalling problems on the roads has hit many firms' profitability and cash flow."

According to the Handy Shipping Guide, costs for hauliers in Britain rose by 4.6 months in the last year, up until October 2010, and 3.2 percent of this was accounted for by diesel costs. Average diesel prices are now at 104.78 pence (before VAT).

It may be that companies need further logistics training, in order to manage the rising costs their businesses face. Semple claims: "Diesel is around 32 percent of operating costs. We strongly recommend companies that have not already done so, to implement a mechanism that links diesel prices to rates."

"Customers can be reluctant to agree to such terms, but we would urge them to recognise the importance such mechanisms can have for the sustainability of their haulage suppliers."

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