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Iain Sherriff from Montreaux

How to meet growing demand

THROUGHOUT Britain and mainland Europe a growth in demand for road haulage services will last well into the 1980s.

But how the demand is met, and how prosperous haulage business becomes as a result of it, lies in the hands of the operators. This was the theme running through the fourth international transport seminar sponsored by Mercedes-Benz at Montreaux last week.

Successive speakers from the world of economics, politics and transport repeatedly told the 280 delegates that they are being offered the opportunity to expand if they are willing and able to meet a variety of challenges. Many of the constraints and challenges are of bureaucratic origin, while others are evolutionary — but all can be overcome.

To meet the bureaucratic challenge Robert Beckam, managing director of S.P.D. Distribution Ltd, suggested that perhaps the transport man should form his own community within the EEC to act as a watchdog Mr Beckam said that the physical challenges have to be met personally. The impressive technological advances that have been made in the vehicle manufacturing industry have ensured that we have the physical means to take up the challenge, but with all that the superb machines have to offer it is the skills of management and men deployed and controlled with energy and vision which are going to be significant in the new impetus required to take our chances in meeting Europe's challenge,'" he declared.

Earlier, Dr Jean Pierre Bonny, a Swiss financial lawyer, had told the seminar that Europe would need to live with economic difficulties for many years to -come. He could not visualise a boom similar to those of the late fifties and sixties ever occurring again "There will be no bed of roses for Europe's economy in the years ahead," he said, but he did forecast gradual growth.

Dr W. Blonk, director general of Transport at the EEC, took up this theme and developed it. The growth rate in the EEC of three per cent between 1976 and 1 978 is totally inadequate, he said. Only drastic steps would raise the growth level to give Europe the economic strength to overcome recession.

Dr Blank said that bulk transport operators would continue to suffer recessionary problems unless major remedial steps were taken. He believed, however, that those who are engaged in carrying consumer goods, particularly foodstuffs, would not suffer to the same extent.

The EEC has developed a protectionist policy which if it continues will hit the international carrier first and hard, he argued. But because protectionism produces insularity it would not affect national markets, and he advocated a more liberal approach to international movements.

As one of the aids in transport management, he said, we could expect freight traffic to be computer controlled by 1990. This would give data to the road haulier clearing the way for greatly speeded up transport.

The overall economic outlook of the next ten years is not optimistic, he said, and this will raise problems for the haulage industry. However, transport forecasts show that there will still be opportunities for expansion.

Figures produced by Dr Blonk show that since 1973 the UK has moved more goods by road than any other EEC country. From 1,873.4 million tons in 1 973 the projected figure for 1985 is 2,663.7 million tons. France, however, appears to be the growth area where the 1973 figures of 1,969.5m will develop to 3,135.6m.

Dr Jurgen Erdrnenger, a German lawyer, who is head of a Directorate within the General. Transport Directorate of the EEC in Brussels, made the point that despite a great deal of effort on behalf of international haulage in Brussels, little has been achieved.

Free trans-frontier haulage has been the Commission's aim since the 1960's, he said, but still restrictions persist. He was particularly concerned with the continuing bi-lateral quota system which he sees as restrictive.

Dr Erdmenger appeared to suggest that the financial position of Europe's railways has much to do with the position and unless it is improved it will be impossible to liberalise international road haulage.

This, he said, was a personal view and not necessarily that of the Commission . . It is EEC policy, however, to "supervise" the road-building programmes of the mainland Europe EEC members so that a co-ordinated infrastructure is developed among the Seven, he said. Referring to the social welfare regulations and in what appeared to be an obvious reference to Britain, he said Some of you have already had trouble with 543/69 but will continued overleaf you please bear in mind how great is the advantage of all drivers in Europe having to adhere to the same working and rest periods. On the other hand, I know, of course, that a good deal still needs to be done before this regulation is implemented by all member countries of the Community."

He reminded the delegates of efforts being made in Brussels towards tax harmonisation and unifori-n weights and dimensions for vehicles which he said would have been impossible in a fragmented Europe.

Returning to the railways' role in international transport, he said that theoretically it makes sense to put long-haul traffic on to rail and short-haul work to roads. He suggested that Europe's long-distance operators are constantly considering new methods for their long-haul movements and this includes transporting trailers of complete road outfits by rail.

The entry of Greece, Spain and Portugal will extend the scope of road transport in Europe, said Dr Erdmenger. In a mild defence of the recently imposed Austrian transit tax he said that the position is understandable — a view not held by many of his audience or platform colleagues.

The transit traffic had doubled every four years in Austria since 1961. And because Switzerland is unlikely to up-rate its Alpine road weight restrictions beyond the existing 28 tons, Austrian transit for heavy traffic will continue to grow, he said.

It was later suggested that compensatory payment by the EEC or development and maintenance of Austria's transport road at EEC expense could be used as a means of replacing the transit tax.

Dr Anton Heimes, a former chief executive of the German Association of , Long Distance Vehicle Operators, now BDF questioned the EEC transport policy. He said that it might be better to reduce or remove obstacles and allow free movement of vehicles rather than develop a common transport policy.

"Instead of chasing Utopian dreams and wanting to attain everything at once we should produce a viable and safe transport policy that is set towards meeting current requirements and then make sure that all member States of the Community put it into practice," he said.

"There is nothing more harmful to the credibility of the EEC, nor more compromising, than regulations and directions that exist only on paper."

Dr Heimes added that this does not mean that he wants to pass negative sentence on the state of affairs created by the existing transport policy, although the results have so far not come up to expectations — mainly because the original target was too high.

If the Community would accept the continued existence of the various national regulations and then, in addition, put into practice the general principles, it would set free resources which have so far been squandered in the idealogical struggle for liberalisation or market regulation, he said.

Dr Heimes felt that a standard regulation for permissible size and weight of vehicles should have been established at the beginning of the European transport policy.

He also referred to the Austrian transit tax and said that the Community must try to ensure that no further burdens are placed on countries who have to transit other European borders.

There appeared to be some reference here to the fact that Switzerland is also considering a transit tax.

Referring to the 543 / 69 regulation, he said that the BDF attitude always was that held by drivers who would not want to be squeezed into a tight corset of social regulations because it would mean restricting freedom in decision making which essentially has to be based on one's needs and changing requirements of a transport system.

While in Germany adherence to rules and regulations are strictly supervised and offences are heavily punished other member countries have no such proced ure, he said. BDF is opposed to a complete liberalisation of the transport market and is in favour of controlled expansion.

"The railways are under pressure to concentrate their efforts on service with their specific type of transport and to withdraw more and more from short distance service,he added. The road/rail war was in his view a myth.

"In any case," he said, "entrepreneurs in transport are not road haulage fanatics, they are transport merchants who would no doubt be prepared to cooperate with the railways so long as customer service didn't suffer and things worked out well financially." He foresaw high hopes of co-operation in long-distance transport, particularly in cross-frontier transport.

R. Beckam, a former president of the Freight Transport Association, said that accepting the uncertainties of forecasting would require only an annual growth rate of three per cent for the European GNP to double by the year 2000 and not many governments in Europe would quarrel with that order of growth.

He felt that it would be sensible therefore for transport planners to be prepared to double traffic volume by the end of the century and to concentrate their attention on freight traffic management systems and infrastructure rather than on the projection of public systems.

Mr Beckam said that road haulage has already aptly demonstrated its ability to grow as fast as it is required to meet demand. It had increased its carrying capacity by eight times in 40 years and shows no sign of losing its competitive edge.

"Nevertheless, as efficient as we are today, we know that we can improve our use of transport by a very large margin." Mr Beckam concentrated on the competitive theme but first of all warned the delegates that the cottage structure of the industry and the fragmentation of its ownership makes it vulnerable to exploitation by its clients. SPD is already using a cooperative system of hauliers in Community countries to move their road tanks and other specialist domestic operators for the movement of hanging garments.

They are highly satisfactory arrangements but this does not mean his company would lose its competitive edge nor did he think there is any danger of this happening to any British haulier when there are 40,000 operators all plying for hire and reward.

That was incentive enough to provide customers with a highquality service at an acceptable rate for the job. If any further stimulus were needed then the total freedom of the British operators' licensing system most certainly provides it. "It is a case of compete or perish," he said.

He said that in the UK operators hold the opinion that the EEC should take the same liberal view over inter-Community permits as they take in the matter of 0-licensing where freedom to operate is a prerequisite to the freedom to compete.

He answered the European criticism that the British are too insular and said -Give us credit for our ready acceptance of the harmonisation legislation so far as international journeys are concerned while taking a second look at our domestic philosophy in those areas where it does not give us an undue competitive advantage."

Mr Beckam thought that it is important that there should be a ransport discussion by trans)ort operators, and not by 3russels bureaucrats.

He criticised the Austrian 3overnment for imposing a ransit tax against the advice of kustrian hauliers and criticised he British Government on its ntransigence on the question of fehicle weights. Estimates in 3ritain suggested that an in;rease even to only 40 tons vould reduce ton /kilometre ;osts on long-distance transport )y up to 12 per cent, he said.

Even the Government's own .esearch organisation had ;tated that fuel savings of the )rder of 17 per cent could be achieved if gross vehicle weights of 38 tons were permit:ed.

Mr Beckam then turned his attention to vehicle population and pointed out with a three per cent annual growth in the GNP and no increase in permitted weights there would be two million vehicles in the UK by the year 2000; but a modest increase in weights would mean that the number of vehicles by the same year would be of the order of 800,000.

Wim Bos, the managing lirector of a Dutch haulage company with 42 lorries, a -lumber of depots, warehouses and mechanical handling aquipment, took up the chance and challenge theme from Mr Beckam. He said that the haulage contractor must see himself more as the architect and organiser of the raw goods, and that he should not content himself with the role of the man who takes over and forwards freight with the help of a few drivers, a few vehicles and a telephone,

Haulage contractors must extend their services and offer a full package, said Mr Bos. He, in his own company, does freight forwarding, haulage, inward clearing, storing, distribution and groupage. He agreed with Mr Beckam that the amount of transport required will continue to rise rapidly between now and the mid eiqhties and that international traffic will assume increasingly larger proportions.

Mr Bos said that he thought the technical problems of the transport operator play a subordinate role when looked at alongside the social problem. He was particularly concerned over the working hours and wage structure.

"In contrast to what is done in all other EEC countries," he said, "the Netherlands are already pursuing a restrictive social wages policy. This means that all businesses are obliged to comply with the decisions of the wage agreements in order to bring labour costs per man, per vehicle and per business into line.

"If wage conditions are not complied with there is a very real danger that the operator will lose his licence, either permanently or have it suspended for a short period He said that the time was long gone when almost 40 per cent of international goods transport in the EEC was handled in the Netherlands.

The reason for this, he argued, was that the Dutch operator is hide-bound by social regulations. Dutch transport operators generally would welcome the harmonisation of the same social regulations throughout the Community.

Dealing with the business of co-operation between member countries, Mr Bos argued that the greatest danger in fact comes from Eastern block countries where labour costs and vehicle costs are much lower. He called on the delegates from the Western European countries to exclude Eastern European contractors from their market.

He realised that haulage companies need to become more sophisticated in order to meet the challenge in the future from businesses and from Eastern European hauliers. Cooperation, he said, should work and would work provided certain techniques were employed, the most important being the marketing technique. If small companies come together, market their services co-operatively and use their strongest points in support of each other, then they will have nothing to fear from any challenge inside or outside of the transport business.

H. Chigonis, a French foreign trade adviser, told of the strong opposition road hauliers are facing in France from the conservationist lobbies who, it appears, are more vehement in their opposition to road transport than in any other country in Europe.

"Dying with the truck" appears to be the slogan favoured by members of the anti-truck committees which have been set up in a number of towns in France and who enjoy more than sympathy from certain sections of the media, he said.

Some of these committees, he warned, go so far as to openly declare the systematic extermination of vehicles as their main objective.

While he accepted that extremes could be ignored, he said that public opinion was being swayed by these extremes in France at the moment. He thought that cordial cooperation was the answer to many of the problems.

In any event he said, combined road/rail transport does not operate efficiently on distances under 250 miles. French hauliers had admitted that some of their services are very much more efficiently handled by road operators.

As in every other European country, the French railway SNCF had had massive financial help from the Government, but despite this it is still running at a loss, he said. Research by the French Ministry of Transport suggests that the next two years would see a further considerable increase in road haulage and a considerable decrease in the activities of SNCF in goods transport.

Coming to the ecological nuisance of the lorry, he said that long gone are the days when vehicles emitted thick clouds of black smoke but nevertheless any black smoke being emitted from a vehicle is a weapon in the hands of the anti-lorry committees. On the question of energy conservation he said that road transport accounts for five per cent of the total oil consumption and for less than two per cent in longdistance transport, that is journeys exceeding 100 miles.

Mr Chigonis said that the efforts made by road hauliers throughout Europe to reduce the annoyance caused by their activities have to take into consideration the overall structure of a business, and the quality of life which a community enjoys because of the activities of road transport and the social and economic benefits of road transport.

Continuing with the road/rail theme, F. De Vos, president of the National Federation of Belgian Hauliers and the International Union for Combined Road/Rail Transport, said that in Europe, where goods trans-: port covers large distances, this method is growing rapidly.

Mr De Vos said that growth occurs only with the cooperation of road hauliers, indeed by the instigation of road hauliers in Germany, France, Switzerland and Belgium.

Mr De Vos pointed out, however, that research and study by his union suggests that combined road/rail traffic becomes economic only at distances of more than 300 miles and that there has to be sufficient volume of traffic moving in both directions before that distance becomes economic for the combined movement.

He said the haulage contractor has to be concerned that he will get a return load before he embarks on a road/rail type operation.

"Indeed," he said, "everything must be foreseen in transport, especially the unforeseen."

According to Mr De Vos, road/rail transport is experiencing a genuine boom, and one which is likely to continue. Like other speakers, he felt that the industry is ready to take its chances and meet its challenges. But he warned that they have to be constantly on their guard if road hauliers are not to, be forced out of business by edict of governments prepared to employ uneconomic methods for moving goods.