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Stagnant rates are crippling hauliers

1st January 1998
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Page 4, 1st January 1998 — Stagnant rates are crippling hauliers
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Which of the following most accurately describes the problem?

by Nicky Clarke • More transport operations look set to go to the wall this year as hauliers across the country give up the struggle against rising costs and stagnant rates. An exclusive survey for Commercial Motor reveals that while 65% of respondents achieved higher rates last year, the average increase was just 2.1%. For the rest, rates stagnated. For 35% of respondents this was the second year without a rate rise. Most will be pitching for a 5% rise for this year, but think they will have to settle for 2.5%.

"Rates are a third too low to enable real investment. The long-term consequence of that is that we'll have to reduce the size of our fleet. You end up eating at cashflow," says Peter Foot, general manager of Portsmouth-based Jordans Transport.

Every respondent's costs rose at least as fast as any • The Society of Practitioners of rates rise Insolvency has published a 40-page guide last year.

for those whose businesses have hit a &Fri"Compan

cult patch. It includes advice on negotiating ies collap s

with creditors and how ing is a dis to survive a cash critinct possi sis. Copies are free. bility when Send an ME (34p) to rates don't SPI Ostrich's Guide, move or 48 Floor Halton even dec House, 20-23 rease as Holborn, London we've seen ECM 2JE. this year because of the strength of the pound," said the managing director of one international haulier.

About 80% of respondents said their drivers had a pay rise last year, with an average figure of 3%. The management of 20% of those companies received no rise.

Most respondents were expecting to increase drivers' pay this year along the lines of inflation.

The managing director of one of the UK's largest transport companies said the current driver shortage meant wages will increase: "It's becoming hard to recruit people so we've go to reward them."

Some 70% of respondents are worried about future legislation such as working time limits.

"It's making us less efficient and impacting on costs, which is not realistic for international operations," says Nick Charlesworth, divisional general manager of Hythe-based Laser International. Charlesworth: Fears that new hours rules will hit efficiency.


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