CORNERING THE TRAFFIC
Page 64
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WiICH transport operators are gaining traffic during the present period of political uncertainty which most of them in theory deplore? Whatever the circumstances the volume of traffic to be carried remains the same. If one type of operator blames the Government for a decline in business other operators will have captured what has been lost.
They may still believe that waiting on the whims of politicians leads to inefficiency but would not be able to offer their balance sheets as proof. This is how it might appear to the outsider. Within the transport industry itself few if any operators are prepared to claim that they are fishing successfully in troubled waters.
The almost universal complaint is that traffic and in some cases even revenue is declining.
The reasons
Reasons given sometimes include the measures deliberately taken to restrict demand and therefore production. Just as frequently the explanation offered is that some customers are unwilling to make use of the services of operators who may soon be handicapped by new legislation.
The conclusion might be that—as on at least one occasion in the past—traders and manufacturers are putting their own vehicles on the road. The reverse is the case if one accepts the figures in the latest reports of the licensing authorities which show for the first time since the war a drop in the number of vehicles on C-licence. From the same source there is proof of a continued steady growth in the number of road haulage vehicles. This can be set as evidence against statements by hauliers themselves that they are losing traffic.
Supporting evidence has come from what may seem a surprising source, the 1966 report of the Transport Holding Company. In addition to the problems facing all hauliers alike, says the report, the publicly-owned undertakings must face "the non-commercial consequences of the closer control which the Government exercises over their investment and over charges". Even more serious for the haulage subsidiaries of the Holding Company "must be the uncertainties created by changes in Government policy and the long period of time which is elapsing before the real shape of things to come is made clear".
Considerable disquiet is generated among both staff and customers, the report continues, "and some of the latter tend to turn their eyes in the direction of businesses that are not thus threatened". The only possible meaning to be extracted from this rather coy turn of phrase is that customers are beginning to drift from British Road Services to independent hauliers because of inability to read Mrs. Castle's mind.
Another passage in the report is relevant. The Holding Company continues to receive many inquiries from hauliers about the possibility of acquisition, or "joining the family" as the report prefers to describe the process. Since the White Paper on transport policy was published in July 1966 the "more attractive type of acquisition, such as the well-established and well-managed business of some size, tended to come far less on offer".
There is a note of regret in this way of putting it. The report offers no explanation for the reduction of the queue at the early door. The inference is that the White Paper relieved many operators of the fear of nationalization and gave them better heart to stay under free enterprise. It would have been less grudging of the Holding Company to welcome this development instead of restricting itself to the disgruntled comment that "the uncertainties, political and financial, likewise affected" its own attitude.
The philosophy
Other passages in the report reflect more exactly what has seemed in recent years to be the philosophy of the Holding Company. The following comment is made in the introductory chapter; "Change occurs more rapidly in a modern and developing industry based on active competition than in an industry that is already fully-fledged or technically monopolistic." The point is taken up again in the conclusion. "For competitive efficiency", says the report, "it is essential in each field of activity to have properly designed entities of business that are managerially controllable, whether road entities or rail entities, with a due measure of working freedom".
It is not certain that the railways would wholly agree with this statement of policy made partly on their behalf. The British Railways Board report for 1966 welcomed the White Paper with its promise of "integration "—a word which, perhaps significantly, the Holding Company succeeds in avRiding.
Another contrast in the railway report was its more leisurely attitude towards change. "The structure of nationalized transport cannot be changed overnight", it said. Reorganization would best be achieved by a "more flexible staged approach, starting first with the parts of nationalized transport which lend themselves to early integration". The obvious example is the new Joint Parcels Organization. This was proposed by the railways, said the report, with the agreement of the Minister and of the Holding Company.
Important move
The degree of enthusiasm of the Holding Company for this particular change is not easily gauged from its report. It will assist "generally towards reducing the very heavy losses now involved in the sundries business of the railways"—a point understandably not stressed in the railways' own report— and "is an important move in a direction advocated for many years". It is intended also, says the Holding Company, that the parcels operators under its control "should maintain full contact with their opposite numbers in the world of privately-owned road haulage".
Certainly railway losses in general increased during 1966. Their financial situation worsened and they also carried less traffic. A similar analysis is not possible from the details in the Holding Company's report. Gross receipts of £89m. in 1966 were more than the total of £80m. in 1965 and there were 463m. vehicle-miles travelled as compared with 425m. The number of traffic vehicles rose by 900 to 19,247 at the end of 1966. In short receipts, mileage and vehicles increased in roughly the same proportions and this would be true of the volume of goods carried on the assumption that rates remained the same throughout the year.
Judged on this somewhat precarious statistical basis the report is by no means unsatisfactory. It does not altogether bear out its own hint that customers are turning to other operators whose businesses seem less threatened. There are few hauliers prepared to admit that they are among the favoured operators. The railways have not gained and traders, if anything, appear to be running down their own fleets. The mystery of who is cornering the traffic remains.