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• HOYER'S UROVISION

25th May 1989, Page 56
25th May 1989
Page 56
Page 57
Page 56, 25th May 1989 — • HOYER'S UROVISION
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Keywords : Lift, Freight Train

Many British transport firms are only now gearing up for 1992 and the Single European Market — but German tanker firm Hoyer has seen Europe as its backyard since the formation of the Common Market in 1957, and it has a grim warning for UK hauliers.

• German tanker giant Hoyer is not waiting for 1992 to expand into the rest of Europe — it has had a base in Britain since 1974. And Fritz Schlund, managing director of Hoyer UK, warns that most transport companies here are woefully unprepared for the Single European Market.

It is not enough for a UK operator to open two bases on the Continent, claim to have moved into Europe and trade only between Britain and those two countries, he says. The UK has to get rid of the myth that it is the hub of Europe, and other countries are merely spokes.

"The hub is the Benelux countries and West Germany," says Schlund. "Britain has to come to terms with the fact that it is on the periphery of Europe, like Spain and Scandinavia. You have to look at Europe from a satellite and not from an office in Whitehall."

RETURN LOADS

Royer UK, based in Huddersfield with depots in Hull, Glasgow, London and Cork, was set up to provide return loads for Hoyer drivers coming to Britain.

The group runs 800 vehicles and has bases in most West European countries, the United States, the Far East and the Soviet Union. Hoyer UK has a fleet of 80 tractive units handling 600 demountable tanker loads.

Operators must study each country they plan to expand into, its culture and its ways of doing business, explains Schlund. "In France, it takes time to understand how business works. Germany is different. The French are more protective of their industry than the Germans."

Companies often make the mistake of viewing the rest of Europe as one entity, says Elke Tiedemann, Schlund's wife and Hoyer UK's marketing director. "If you have a base in France, you have not entered Europe — you have entered France. Each market is different."

Hoyer has always put the understanding of other markets at the forefront of its expansion plans, says Schlund. "In 1957 it became apparent that Europe would look very different when the Treaty of Rome which created the Common Market was signed," he explains. "The UK was a natural successor in 1974 for Hoyer, but it is only now that medium-sized UK companies, pressed by the Government, are looking to Europe — 15 years after going into the EC. Large companies like ICI are looking to Europe, but they are ignoring transport."

Transport firms that did break into Europe in the 1970s initially made big mistakes and pulled out, NFC being the most famous example, says Schlund. He estimates that to be a major player in Europe now, a big transport firm would have to invest £100 million.

Transport in countries such as Germany, the Netherlands and Switzerland has a better image than in the UK. It attracts managers who might, for example, go into banking here. "In those countries transport is considered a profession; there is no formal training here. It attracts the wrong people, who are not geared to making plans for 1992," he says. Fashionably-dressed Schlund looks more like an advertising executive than a sober transport boss.

Half of Hoyer UK's administrative staff are graduates. Schlund says that because most high-calibre graduates in England are soaked up by the City, Hoyer UK recruits many of its entrants from Dublin. It has also copied the German apprenticeship system by sponsoring a three-year transport administration course at Huddersfield Polytechnic.

Most of its staff speak languages other than German, and although Germany still represents half of Hoyer's business, the UK subsidiary is growing fast. Most of its expansion here is from business won from competitors, says Schlund. Only 20% of its growth comes from new custom.

The majority of Hoyer's business is in demounts which represent a growing part of its operation, at the expense of traditional tankers. Demounts have the flexibility to be carried on road or rail, and do away with drivers having to come home empty, says Schlund.

"A tractive unit can pull a container from Huddersfield to Hull. It is lifted on to a boat, and the next time a driver sees it, it is in Milan and ready to be delivered to a customer,'' he says.

Royer uses swap bodies on its European operation and around 400 six-metre ISO units for its deep-sea traffic to the US and Far East. Multimodel freight is much more common on the Continent than in the UK, but the quality of rail networks differs from country to country.

RAILWAY SYSTEM

Germany has the world's most modern railway system, says Schlund, but France's is centred on Paris. In the UK, 20% of Hoyer's loads are moved by rail. In Germany it is 50%. The Continental customer of hazardous goods has a different approach to that of the UK customer, he adds. In Germany most hazardous consignments are carried by rail.

Schlund is sceptical about the possible benefits of the Channel Tunnel for Britain. Although he says that Hoyer is Britain's biggest user of rail tanker containers, he doubts whether the Chunnel will have an effect on the company's operations.

Hoyer is a major carrier of chemicals, and the UK chemicals industry is concentrated in the North-East, he says. There is only one suitable long rail access across Britain's industrial belt from Glasgow to Manchester and on to London and Southampton. Railways only become competitive on trips over 300km, so the Chunnel will only be attractive to high-value consumer goods, he maintains.

I Most of Hoyer's UK fleet consists of I Volvo FL10s, with some Mercedes 1729s and 1735s and MANs, all plated at 38 or 40 tonnes. Volvos, says Schlund, have the highest payload of any 38-tonner available. All its container trailer chassis are airsuspended tri-axles, and most of its tanks are aluminium.

The company's tank containers are made in Spain, Holland, Germany and the UK. Its policy is to spend as much capital as possible in the country where its subsidiary is based, "although the bodies have to be competitive in terms of quality and price," says Schlund. Hoyer UK does a lot of business with M1 Engineering in Bradford. Almost all of Hoyer's repairs are made at six depots across Europe.

SMALL OPERATORS

Up to 80% of its UK fleet used to be subcontracted to small operators, but now 80% of its vehicles are owned. It has never subcontracted its containers; only the tractive units are run by outside hauliers. "Subcontracting is cheaper but we cannot control quality," explains Schlund. "The tractive unit and the driver is the weakest and most important link in our operation".

The SEM will provide a massive opportunity for UK hauliers, giving a "second bite of the cherry" to many firms which have tried and failed to enter Europe in the past, says Schlund. Their trump card is that the UK is a freer haulage market than Germany or France.

However, anyone who thinks the Continent will be an easy target because of high rates is wrong, he insists. The tariff — there to limit the number of operators, and helping those in the industry to get enough return on their investment to train and maintain vehicles properly — will have to go, and hauliers will have to come to terms with losing it. But German and other Continental operators are "not as protected as people think," he says. Rates have always been negotiable by margins of up to 23%, and large customers have always flexed their muscles.

Not that 1992 will make the tiny UK haulier extinct, says Schlund. There will be two markets — specialist hauliers working in local areas and counting on "the local operator syndrome", and cowboys, whose trade depends solely on price. "There will always be these marginal operators," he says, "but the market is sinking." LI by Murdo Morrison.


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