Rates increases inevitable says RHA's new chairman
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• The new national chairman of the Road Haulage Association, Mr W. McMillan, has written this week to all members of the Association telling them that the wages explosion and other cost increases make rates rises inevitable.
This action follows the revelation (CM June 19) that some large hauliers in the London area were already telling customers of the need for rates increases as high as 15 or 20 per cent, the decision by express carriers that the NEC 10 per cent rates increase was applicable also to privately hauled traffic, and reports from several parts of the country that hauliers were hastening to apply increases (in most cases around 10 per cent) from July 1. There was also the news, given in last week's issue, that the TGWU intended to apply its campaign for a £20 basic minimum rate throughout the country.
The full text of Mr McMillan's letter is as follows: "As a matter of urgency I must draw your attention to the increase in the costs of operating road goods vehicles, which, beginning early in the new year, are now escalating rapidly.
"You will have read in the Press and Road Way the first results of the CIEC investigation into costs and productivity in the road haulage industry. The Centre for Interfirm Comparison is an independent non-profit making organization which was established 10 years ago by the British Institute of Management in association with the British Productivity Council. It has conducted Interfirm comparison schemes in some 70 industries and trades.
"The Centre has found that the profitability of the road haulage industry compares poorly with the profitability of the industries represented in all schemes operated by the Centre for Interfirm Comparison over the same period. The evidence shows that the profits of our members generally are too small to allow for the absorption of any but the most minor increases in costs.
"In addition to these findings by CIEC, I must refer now to the period beyond that to which their investigation relates. Events since the end of January 1970 obliged all operators, despite rate adjustments already effected this year, again—and immediately—to examine their costs.
"The current explosion of wages and the severe increases in almost all other items of cost make this action necessary and increases in rates inevitable.
"Already many of our members have given notice of rates increases of between 10 per cent and 20 per cent and it would seem to be vital that all our members take steps to put their own affairs in order NOW."