Hard times set to continue vulnerable hauliers told
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ay Roger Brawn SMALLand medium-sized operators will find themselves in a perilous financial position as they emerge from the recession, one road transport market analyst has warned.
Transport Intelligence (T1) predicts many smaller hauliers will have -burnt through" their working capital over the previous year and be particularly vulnerable to additional costs, which they will find difficult to pass on.
John Manners-Bell, chief executive at TI, says: -The likelihood is that many firms will be unable to make it through this stage of the economic cycle where rising costs outstrip any increase in volumes.
"Larger companies, however, will be in a stronger position."
Manners-Bell believes the road transport industry has avoided a catastrophic meltdown due to lower global oil prices and interest rates. Oil, which accounts for about a third of vehicle running costs, has fallen some 50% from historic highs of around $140 per barrel in July 2008 to about $70 today. UK Base Rates stood at 5% in July 2008, and are now 0.5%.
Jo Tanner, communications director at the Freight Transport Association, says: "While a barrel of oil is much cheaper than it was this time last year, when it was extraordinarily high, pump prices remain artificially high, due to speculators in the market. Also, the Base Rate may be incredibly low, but banks are not only failing to pass this rate on to businesses, they are squeezing credit terms, too."
Jack Semple, Road Haulage Association policy director, says: "The industry remains in crisis. The fall in the UK price of diesel has helped, but has been less than the fall in world oil prices" Mark O'Bornick, director, research and analysis at Analytiqa, which carried out a survey in May of 3,900 hauliers as part of its European Transport Barometer 2009, says: "The current crisis may give a boost to mergers and acquisitions, especially among medium-sized firms, but it will not be felt immediately."
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