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Fuel Crisis in France?

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Today, we read the following article printed in Ouest-France, our local newspaper and it does make interesting reading. As a servixce to members and guests we have translated the entire article so that all may know what is happening:

 

Road haulers claim assistance in the face of increasing fuel costs.

 

As Diesel prices climb, the lorry drivers thunder

 

Because of the ever-increasing rise in the cost of diesel, the road haulers of Unostra started, yesterday, to block fuel deposits in order to obtain assistances of the government.

 

"A general watchword was given by Unostra for blocking for an unspecified duration some of the strategic sites in France, the oil terminals, the distribution centres or the borders" the instruction of Catherine Pons, president of Unostra, is clear. The objective also: "To challenge the government stronger than we have not been able to do it for two years on the economic catastrophe for our corporation vis-à-vis the rise in the price of the fuel"

 

Problems in the West

 

The road transport of French goods, already weakened by an increasing European competition and a morose economic situation, undergoes a rise of more than 21 % in the prices of diesel since the beginning of 2005, according to recent figures' from the ministry for Industry.

 

Unostra, which represents 4,500 members –mainly independent companies of modest size -, pointed three claims. Firstly, a significant fall in TIPP (inland duty on the petroleum products), to bring back it to the European average. Then, a reduction in the professional tax by the removal of the vehicles from service. The haulers complain, indeed, "to pay full pot" the TP on the basis of price of a new truck whose value decrease, actually, very quickly, and three, the reduction of the employers' social contributions over the hours other than control.

 

On the ground, the mobilization started. Yesterday, of tens of trucks blocked a fuel depot, close to Mulhouse (Haut-Rhin), and in Frontignan (Hérault) - survey yesterday evening - two refineries in Côte-d'Or (evacuated last evening), and two others in Port-la-Nouvelle (Aude). In the West, Unostra in Pays de la Loire deferred until this morning blockings of deposits expected on Monday because of the presence of the police force. Brittany is also on the point of launching some form of action. Unostra also hopes that the farmers and other professions (driving schools, ambulances, taxis) affected by this problem will join the movement. Failing this, for the moment, it is imperative that the other employers' federations (FNTR or TLF) are convinced.

 

In the immediate future, the Ministry for Transport announced that it wants "to set up, as soon as possible, an effective and fast measurement making it possible for the haulage companies to reflect the fuel rises in the price of their services" and "to finalize an additional reduction of the professional tax". The road haulers will make their own judgement.

For our part, as a company severely affected by these increases, we support whatever action is taken as we are operating at virtually ZERO profit. So that we can continue to operate and provide employment something has to be done by our government to assist all road hauliers. We hate to say this but a steady and continuous supply of merchadise, especially foodstuffs, MUST come before the needs of social transport if we are not to be driven into a recession. A continuous upward spiral of fuel prices will only lead to an increase in the cost of living.

Micheil & Jacqui

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Re: A Looming Fuel Crisis in France?

 

Have to say I support this action too. Governments make far too much money taxing fuel, 80% on petrol just isn't reasonable and hasn't been for ages. Not sure what OPEC are playing at, whether they are responsible in part for fixing the price of fuel at an artificially high rate rather than forcing competition to happen properly.

 

Just a thought, if enough hauliers started putting red diesel in their trucks..!

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Re: A Looming Fuel Crisis in France?

 

Just a thought, if enough hauliers started putting red diesel in their trucks..!

 

Don't even think about going there! Maybe be just dyed in UK, but here it's nearly as bad as TVO - and that is ****. The other thing is that "red" diesel will do all kinds of damage to ECO3 & ECO4 engines, and replacing them is not cheap.

 

Micheil & Jacqui

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A bad suggested, no doubt ;)

 

I thought it was just made pretty colours to stop you from putting it in your engine rather than your fridge, but I suppose it does make sense to use lower grade fuel!

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Re: A Looming Fuel Crisis in France?

 

Diesel prices are also rising steeply in the UK. At the local esso, it is 96.9 per litre,at Sainsburys it is a few P cheaper so it is always choc-a-bloc at the petrol station there.

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Well, haulier companies get tax "discount" to pay back this petrol tax, explaining why the 2 mains associations (UNOSTRA is 3rd) didn't call for demonstrations.

In France (it seems also in UK) haulier are a strong lobby and I tend not to trust them when they are complaining (general feeling here, no personnal thought). I can't see why hauliers would get tax discount, why not taxi, countryside doctors, air companies, me.... Maybe because they can't blockade, an A320 on Paris ring would be funny though.

BTW: No blockade anymore tonight, A9 motorway closed, but because of flood.

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Re: A Looming Fuel Crisis in France?

 

Not sure what OPEC are playing at, whether they are responsible in part for fixing the price of fuel at an artificially high rate rather than forcing competition to happen properly.

 

The recent rises in fuel prices has very little to do with OPEC or any of the other Oil producers but is more to do with the shortage of refining capacity. To make matters worse , the recent hurricane ‘Katrina’ took out refining capacity in the USA and that has put an even tighter squeeze on existing capacities in this past 7-8 days and will do for the forseable.

The blame (I use the word blame loosely) in this instance is not with OPEC. There is plenty of crude oil on tap, especially since the Invasion of Iraq, but converting it to something more useful and that we all need (and demand) is another matter.

Wiggo…….

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Re: A Looming Fuel Crisis in France?

 

Because of the ever-increasing rise in the cost of diesel, the road haulers of Unostra started, yesterday, to block fuel deposits in order to obtain assistances of the government.

 

I have just done a quick back of the envelope calculation and I am sorry but I don’t see the argument from the road transport people about fuel prices. If diesel fuel is, let’s say, £4 per gallon (or the Euro Equivalent) and then goes to £5, what real difference does that make to the value of a full trailer load of goods at say £50,000 over a 1,000 mile journey? If the truck can do an average of 9 mpg then the cost of transporting the goods goes up by about 0.22%, surely this can be passed onto the customer? OK, it is inflationary but nothing in comparison to a ½ or even a ¼ point raising of interest rates. And, £50,000 for the total value of a truck load of goods is relatively small and I would hazard a guess that average values are higher and therefore the cost increase has a lesser effect than the example above, although as always I stand to be corrected.

Wiggo………

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Re: A Looming Fuel Crisis in France?

 

I'm afraid you do stand to be corrected.

 

Others that know more about it than me will no doubt put some PROPER average figures on a trailer load of goods, but I know that for my company we regularly have 40ft. trailers full of produce delivered in with a value of less than £8000, and when we export it is rarely that the value much exceeds £20,000.

 

I also stand to be corrected, but a £50,000 average sounds like an awful lot to me.

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Re: A Looming Fuel Crisis in France?

 

It all really depends on the nature of your business really... and that of course, varies a lot.

 

For example, Computers are somewhat more expensive than Cabbages. If you're delivering heavy industrial equipment, like, let's say aircraft wings, then it's going to effect you a lot.

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I'm afraid you do stand to be corrected.

 

I know, I said I did!

 

Others that know more about it than me will no doubt put some PROPER average figures on a trailer load of goods, but I know that for my company we regularly have 40ft. trailers full of produce delivered in with a value of less than £8000, and when we export it is rarely that the value much exceeds £20,000.

 

I also stand to be corrected, but a £50,000 average sounds like an awful lot to me.

 

My only experience was more than 20 years ago and we were moving truck loads of cigarettes but even then the insured value was £200K+ and as I say that was 20 years ago. I can only work on averages and don’t have the info to be specific. Sure some values will be less and some greater. A trailer load of say 9 family saloon cars at a discounted price of say £12k each would be £108K, ie: more than double my average. A trailer load of cabbage may well be below my £50K example but then I doubt they are the sort of product you transport a 1000 miles.

 

and when we export it is rarely that the value much exceeds £20,000.

 

Well using your figures and still using the 1,000 mile journey (above average I am sure but I can live with it) then you are talking about a more substantial .56% increase, or to put it another way 1/5 of a penny on a tin of baked beans if that was the £20K cargo. (I am reliably informed that Baked Beans are 44p for a 415gram can at Sainsbury therefore a 40 metric tonne trailer can carry 96,000+ cans of beans but I have halved it for good measure and still my calculation is 1/5 of a penny increase)

 

I also stand to be corrected, but a £50,000 average sounds like an awful lot to me.

 

Maybe someone out there can enlighten us both then…

Wiggo……

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Might just be missing something here but isn't the key value how much the SHIPPING charge is on the product?

 

Logistics firms like the one I worked (Exel BP contract) in have to rent their warehouses, pay their drivers (sometimes through agencies), pay their transport clerks (me!) and managers, their customer services teams, their HR department and their accountants. Not to mention paying for the computer equiptment including expensive UNIX terminal systems, high volume printers. Trucks need to be serviced and MOTd suprisingly regularly and as they're very expensive they depreciate rapidly and represent a lot of capital ventured. And the logistics firm won't get paid £20,000 for transporting £20,000 of produce!

 

I might be missing something obvious though...

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It all really depends on the nature of your business really... and that of course, varies a lot.

 

For example, Computers are somewhat more expensive than Cabbages. If you're delivering heavy industrial equipment, like, let's say aircraft wings, then it's going to effect you a lot.

 

But is it really Jim, I mean what is the value of an aircraft wing, £5Million, £10Million and does this increase in fuel cost really make such a difference to a high value item such as an aircraft? I suspect the machining heating/cooling (general manufacture costs which all use fuel in some way) have a far bigger impact on price than the transport cost will. Also, if you are referring to Airbus which I assume you must be, then that is an anomalous business anyway, what with various chunks of aircraft being built in the far flung corners Europe and shipped to one centre for assembly! The company was set up politically and not practically!

 

I am not saying that the oil price is not inflationary, it has to be of course but interest rates are relatively low and I can tell you I would much rather have this level of fuel price than an extra 1 or 2% of base rate increase any day! I just don’t see why it is the road haulage guys who are complaining loudest unless of course they are tied into low margin fixed price contracts, but if they are, more fool them.

I just don’t see it in the numbers. I think the translation that Micheil and Jacqui very kindly posted originally has the tell tale sign of where the real problems for French haulage firms and indeed French business in general is (“The road transport of French goods, already weakened by an increasing European competition and a morose economic situation”) and the fact is that French business is not currently able to compete efficiently across Europe for other more deep seated reasons and the Fuel price increase is an easy distraction.

 

Wiggo.......

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Re: A Looming Fuel Crisis in France?

 

Might just be missing something here but isn't the key value how much the SHIPPING charge is on the product?

 

Logistics firms like the one I worked (Exel BP contract) in have to rent their warehouses, pay their drivers (sometimes through agencies), pay their transport clerks (me!) and managers, their customer services teams, their HR department and their accountants. Not to mention paying for the computer equiptment including expensive UNIX terminal systems, high volume printers. Trucks need to be serviced and MOTd suprisingly regularly and as they're very expensive they depreciate rapidly and represent a lot of capital ventured. And the logistics firm won't get paid £20,000 for transporting £20,000 of produce!

 

I might be missing something obvious though...

 

R, you make very valid points. The cost of moving goods includes all of the cost issues you raise and fuel is but one small part.

I think there is possibly a small confusion in your understanding of the previous posts in so far as a haulage firm will not (very unlikely) get £20K for moving £20K of produce. My point was that if they are moving £20K worth of goods (I actually used £50K) , the costs you mention plus others (Drivers, Warehouses, HR, Truck Amortisation, Toll Road Charges, Ferry Costs etc etc etc) will all have an impact on the cost of logistics and a 21% increase in fuel will have an effect but it is, to my calculation, a relatively negligible effect in the grand scheme of things.

A colleague of mine is heavily involved in property development in both the west Country in the UK and around Biarritz, France. I know for a fact that the values of commercial property in that region of France have gone up some 200%+ in the past 5 years and that therefore must have an effect on businesses (including logistics firms) operating from that region and they may well grumble and complain over a glass of red with their mates but, they just build the increase into their costs and pass it on to the customer. Simple economics!

Wiggo……………..

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Re: A Looming Fuel Crisis in France?

 

After five years of covering the UK commercial sector I have come to the conclusion that when any group starts complaining about unexpected rises in one particular overhead it is usually because competitive pressures in an oversupplied marketplace have caused them to cut margins to the bone. I understand over-capacity is one of the major problems in the UK haulage industry and wonder if it is the same in France.

 

No doubt we shall soon hear threats, over here, from those 'hard working' groups like Hauliers and Farmers who funnily enough always seems to be able to take weeks off from their demanding businesses in order to blockade ports and refineries.

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Do these French hauliers not realise that the French Government has no money of its own? Like all Goverenments, it relies on tax revenues from citizens and Industry. If industry ends up paying less the citizens will pay more - the French economy is already stretched. These same lorry drivers were demanding at 35 hour week a couple of years ago - something which has made their industry much less competetive internationally.

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Do these French hauliers not realise that the French Government has no money of its own? Like all Goverenments, it relies on tax revenues from citizens and Industry. If industry ends up paying less the citizens will pay more - the French economy is already stretched. These same lorry drivers were demanding at 35 hour week a couple of years ago - something which has made their industry much less competetive internationally.

I agree with you on fisrt part, but will correct the second:

That's little hauliers company BOSS who are now complaining, not their staff (which in those company should be from 1 to 5 drivers).

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Re: A Looming Fuel Crisis in France?

 

We have looked at the issues put forward by members and have tried to address some them.

 

So to start with, let us take a closer look at the scenario that has been put forward:

 

If a truck travels 1000 miles, at 9 mpg and diesel costs £4.00 a gallon that gives one a fuel cost outlay of approximately £445. If that fuel then costs £5.00 a gallon then the fuel cost increases to approximately £556. That by anybody’s reckoning is an increase of 24% on fuel costs.

 

If one then takes the average yearly mileage for the average 44-ton lorry as being in the region of 220,000 miles per year, then with the increases we are seeing then the fuel cost jumps from £97,500 to £123,320 per truck per year. So when one is operating 60 vehicles, as we are, then one’s extra fuel cost is £1,549,200 per year.

 

One also must take into account with the spiralling cost of oil there will be price rises for other oil-based products: e.g. engine oil, gearbox oil, tyres, mud flaps, parts used in the manufacture of vehicles, all these will increase the overheads of the haulage industry.

 

Another point that the majority of people do not understand is that the haulage industry does not price ongoing work on a daily basis, but quotes a price that is held for, normally, a year. When the client accepts that contract price, the haulier has normally built into it a percentage for increased costs based on what is known at the time, not what we have seen in the past six months. Thus one has a situation, that in the present climate, that is costing the haulage industry money.

 

It should also be understood that “Goods in Transit” insurance premiums are rising nearly as fast as fuel costs. This again, is not something that could be foreseen a few years ago, firstly we had 9/11, then the attack in Madrid and last of all the terrorist attacks of July in London. After each one of these incidents insurance premiums have risen.

 

So we, the haulier are faced with ever decreasing income, when compared with expenditure. An example being La Rochelle to London, 44-ton Truck (full load), a year ago we were charging around £1,100 and on that we were making approximately 18%, today we are lucky to make 6%, for that we count ourselves fortunate as some haulage companies are struggling to break even.

 

If every road haulier were to charge the going rate for the job, and by that we mean make a reasonable profit then we could see inflation rise to around 7% and that could have the effect of possibly bringing on a recession and the consequence of that being a rise in unemployment.

 

As to the value of the load, that in most cases is irrelevant as far as the haulier is concerned providing it fits into a standard 12-metre ISO trailer, the client is paying to move it from A to B, no matter whether it’s oranges or washing machines the price is the same!!. However for very high value cargoes then there are operators around who specialize in this type of work for which the client pays a hefty premium, likewise with STGO classes of goods.

 

It seems to us, and somebody might like to prove us wrong, that the man in the street wants his/her needs supplied as cheaply as possible. If that is the case and the public expects every haulier with 60 vehicles to absorb these increases mentioned above, then within a short period of time there could be no vehicles left on the road, as there will be companies closing down in rapid succession. This will have the effect of increasing unemployment and thus shortages of everything that is sold in shops will start to happen. As it is we have heard of 14 haulage companies of good repute having to close in the past month due to spiralling costs. A year ago trying to find a good Class 1 HGV driver was almost impossible, today you can take your choice, this has occurred because companies have either closed down or have gone bankrupt.

 

As to the working week, that is another issue, our drivers work a 48-hour week every week, as do many other companies drivers. That is the legal maximum we can ask our drivers to work – not French legislation but EU legislation, the same applies right across the EU.

 

As for the governments not having their own cash that is correct they do have to raise it through taxes. But when one looks at the amount of money that is wasted then one should ask questions. The other thing to bear in mind is that when companies fail, for whatever reason, then it is the governments that have to pay out. So there has to be a balancing act between income and expenditure, if haulage companies fail, then there is unemployment, thus expenditure on the part of governments and loss of revenue. Quite honestly until governments realize that they cannot use the motorist, be they private or commercial, as a milk cow then this situation will prevail. It will come to the point, one day, when everybody says “enough is enough” and cuts down on the fuel they buy – result lower revenues for governments. Isn’t better to have 50% of £100 than 80% of £50, just a thought.

 

Maybe this will go some way to explaining the situation as we see it.

 

 

 

Micheil I.J.Homewood – Joint Managing Director

Sulio Visant – Operations Director

H.S.M.International SA

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If every road haulier were to charge the going rate for the job, and by that we mean make a reasonable profit then we could see inflation rise to around 7% and that could have the effect of possibly bringing on a recession and the consequence of that being a rise in unemployment.

 

There is no point in being in business if you do not make a reasonable profit. If all you can do in your particular marketplace is break even then frankly it isn't worth the effort. You may wish to bring wider social considerations to bear - I would too - but the fact remains that if a 7% rise in rate is what's needed to make sufficient money then the number of operators must shrink until the law of supply and demand works in favour of the remainder. After all a rise in taxation to make up the shortfall would be equally, perhaps more, inflationary. If France is in economic recession it needs to look rather wider than the price of fuel. It's currency for example....?

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Re: A Looming Fuel Crisis in France?

 

There is no point in being in business if you do not make a reasonable profit. If all you can do in your particular marketplace is break even then frankly it isn't worth the effort. You may wish to bring wider social considerations to bear - I would too - but the fact remains that if a 7% rise in rate is what's needed to make sufficient money then the number of operators must shrink until the law of supply and demand works in favour of the remainder. After all a rise in taxation to make up the shortfall would be equally, perhaps more, inflationary. If France is in economic recession it needs to look rather wider than the price of fuel. It's currency for example....?

 

 

Could not agree more, although I have said a little more on the issue below!

 

Wiggo........

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Re: A Looming Fuel Crisis in France?

 

As someone who in the past has experience of trying to get home form holiday but being stuck in France in a blockade with small children and little food or water and getting absolutely no help from the local authorities, I possibly have a jaundiced view of this area. Irrespective of the right of hauliers/ farmers or whoever to exercise their right to disrupt life, when it starts affecting your children's health, you get angry. Its interesting tho that comparitively little attention is paid the fuel companies who make immese amounts of money from us drivers. No one begrudges companies making reasonable amounts but didn't the French company Total announce rather large profits yesterday .... or is that ok? Its perhaps not just Governments who have a part to play .... but they are an easy target.

I still visit France regularly both on pleasure and business but I promised myself I would take my business elsewhere if I ever suffered in the same way again. Planning to be in Brittany again for a week starting 20 Sep and hoping for a positive business visit. Perhaps I will be lucky?

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Re: A Looming Fuel Crisis in France?

 

We have looked at the issues put forward by members and have tried to address some them.

 

So to start with, let us take a closer look at the scenario that has been put forward:

 

And when we do that, we should remember that the original post was about ‘action’ to be taken by hauliers that, in my opinion, could have caused havoc to the rest of the law abiding population of Europe let alone France. We should remember that the French economy is not at it’s most robust just now and I believe we should consider when presented with ‘scenarios’ is, is the action, or proposed action, really justified and sensible? Or, possibly is it just another case of a militant bunch of workers flexing their muscles because they think they have an easy target and feel hard done to?

 

If a truck travels 1000 miles, at 9 mpg and diesel costs £4.00 a gallon that gives one a fuel cost outlay of approximately £445. If that fuel then costs £5.00 a gallon then the fuel cost increases to approximately £556. That by anybody’s reckoning is an increase of 24% on fuel costs.

 

If one then takes the average yearly mileage for the average 44-ton lorry as being in the region of 220,000 miles per year, then with the increases we are seeing then the fuel cost jumps from £97,500 to £123,320 per truck per year. So when one is operating 60 vehicles, as we are, then one’s extra fuel cost is £1,549,200 per year.

 

OK but that cost is spread over millions and millions of pounds worth of cargo transported during that time.

Using the ‘shock tactic’ of a figure which to most people will seem large (£1,549,200) does not do justice and is not balanced for a debate.

 

Using the original scenario, if that 44 ton lorry’s 220,000 annual mileage was made up of (to keep it simple) 220 x 500 miles round trips, and we use my original figure of £50,000 per average value of cargo (because no more informed member has suggested it should be otherwise yet) then the total value of goods transported would be £11,000,000 per truck. So if it’s fuel costs had gone up from £97,500 to £123,320, ie: £25,820 then we have to spread that cost increase over the cost of the goods transported (just like we do with salaries, amortisation of vehicle, logistics costs etc) and that amounts to approximately 0.235% increase on the cost of goods transported. Let’s say I am out by ½, it is still not .5%! Is this enough of a reason to blockade refineries?

 

One also must take into account with the spiralling cost of oil there will be price rises for other oil-based products: e.g. engine oil, gearbox oil, tyres, mud flaps, parts used in the manufacture of vehicles, all these will increase the overheads of the haulage industry.

 

Yes of course there will increases, as will there be increases in cleaning fluids, fridges, cookers, medicines, ferry crossings etc etc etc and any other items you care to think of for any other industry you can imagine, but is that a reason enough to blockade refineries?

 

Another point that the majority of people do not understand is that the haulage industry does not price ongoing work on a daily basis, but quotes a price that is held for, normally, a year. When the client accepts that contract price, the haulier has normally built into it a percentage for increased costs based on what is known at the time, not what we have seen in the past six months. Thus one has a situation, that in the present climate, that is costing the haulage industry money.

 

So that suggests that for every haulage firm that is locked into a 12 month contract there will be another one renewing his (or her) deals today and so they will presumberly lock into any contract the higher cost of fuel. If then fuel prices go down, they will be making a little more profit and have a better year, next year!

 

It should also be understood that “Goods in Transit” insurance premiums are rising nearly as fast as fuel costs.

 

So go and blockade the insurance companies!

&

Should this not be a direct client cost like it is in shipping?

 

This again, is not something that could be foreseen a few years ago, firstly we had 9/11, then the attack in Madrid and last of all the terrorist attacks of July in London. After each one of these incidents insurance premiums have risen.

 

We have all of us, in every industry had to deal with the fall out of this, not just haulage firms!

The premiums did indeed rise. We are operating in parts of the world where we could not get terrorist cover for a period of 6 months (could not get it in the UK either for that matter) until the Americans (bless em) stepped in and realised that funders would not put money into new projects unless they could get that cover, however there was still a downturn in large construction projects and the increase in security costs had an enormous impact on the bottom line. But to be fair, insurance premiums are one of our biggest costs also and although still high, they have come off from the highs following the atrocities of September 11th and there is a lot more competition out there today.

 

So we, the haulier are faced with ever decreasing income, when compared with expenditure. An example being La Rochelle to London, 44-ton Truck (full load), a year ago we were charging around £1,100 and on that we were making approximately 18%, today we are lucky to make 6%, for that we count ourselves fortunate as some haulage companies are struggling to break even.

 

18% sounds very healthy for your industry. I suggest that some kind of price increase may be in order if it is now being squeezed. On your figures, if you wanted to put another 6% on the bottom line then that would add £66 to the price of the example given (in simple terms). If others can do it more cheaply then the problem may well not be with the fuel price alone.

 

If every road haulier were to charge the going rate for the job, and by that we mean make a reasonable profit then we could see inflation rise to around 7% and that could have the effect of possibly bringing on a recession and the consequence of that being a rise in unemployment.

 

I am sorry, but I do not see that 7% inflation calculation at all and would like to be enlighten on those economics. I am not sure if I am angry or amused that you seem to be suggesting that the haulage industry is taking the worlds problems on it’s shoulders and is running this altruistic exercise to stave off inflation!

 

Trucking prices may well be lower than they should be, I don’t know, but I bet that if they are it is to do with over supply and not fuel cost rises in isolation. In fact, if there were margins of 18% to be made I am would not be surprised at all to find that people have piled into the logistics business to reap those kind of rewards.

You should take a look at bulk shipping rates, they have gone up 100’s of % in some quarters over the past few years and while you are looking at historical costs, have a look at the price of steel over the past 24 months and spare a thought for those who are trying to build large infrastructure projects with 3-4 year lead times, let alone 12 month contracts.

 

As to the value of the load, that in most cases is irrelevant as far as the haulier is concerned providing it fits into a standard 12-metre ISO trailer, the client is paying to move it from A to B, no matter whether it’s oranges or washing machines the price is the same!!. However for very high value cargoes then there are operators around who specialize in this type of work for which the client pays a hefty premium, likewise with STGO classes of goods.

 

Yes I am sure it is irrelevant to the Haulier and I agree but if you are talking about inflationary pressures (which you have), then the value of the cargo is paramount to that discussion, it has to be.

 

If you can quote a figure of 7% as you did above, then you must surely be referring to the cost increase of the goods transported and it can not be “irrelevant”!

 

The Freight Transport Association (FTA) reckons that the running cost increase of a 3x3 44 tonnes truck in the UK is 4.49% due to the 12 month rise in fuel. Take that off your 18% and you should still be above 10%. Interestingly, they (LTA) suggest that the average mileage for the aforementioned vehicle is only 70,000 miles. You obviously work your vehicles a little harder at 220,000 miles!

 

It seems to us, and somebody might like to prove us wrong, that the man in the street wants his/her needs supplied as cheaply as possible.

 

Of course he/she does! In a safe, reliable, as environmentally friendly and efficient manner as is practical and possible! What’s wrong with that?

 

If that is the case and the public expects every haulier with 60 vehicles to absorb these increases mentioned above, then within a short period of time there could be no vehicles left on the road, as there will be companies closing down in rapid succession.

 

Nonsense, because when there is a gap in the market someone will fill that gap and prices will be adjusted accordingly.

 

We have been here before when discussing BF pricing and my memory is not what it was but, I am sure you were in the ‘supply and demand’ side of that debate. Well it must be the same rules with this debate also!

 

This will have the effect of increasing unemployment and thus shortages of everything that is sold in shops will start to happen.

 

Again, nonsense. Shortage of fuel from blockaded refineries etc may (would in time) have an impact on supplies and the ability of people to get to work, which will in turn lead to a downturn in the economy which will of course lead to unemployment which will then I assume lead to a reduction in the need for fuel which of course will lower the prices. Yes, if you want cheap fuel, blockade the refineries, send economies into a tailspin and sure enough I am certain fuel prices will come down!

 

As it is we have heard of 14 haulage companies of good repute having to close in the past month due to spiralling costs. A year ago trying to find a good Class 1 HGV driver was almost impossible, today you can take your choice, this has occurred because companies have either closed down or have gone bankrupt.

 

I assume you are referring to French haulage companies. The French economy is not that robust and is struggling in some quarters and I am sure fuel prices are not helping but lets get back to the original idea of blockading refineries as someway of sorting out the ills of your industry, I am sorry, I think it foolhardy and not attacking the real areas of difficulty.

 

As to the working week, that is another issue, our drivers work a 48-hour week every week, as do many other companies drivers. That is the legal maximum we can ask our drivers to work – not French legislation but EU legislation, the same applies right across the EU.

 

Imagine the impact if the 35 hour week were in place for drivers! A good reason to blockade the European Parliament, not refineries.

 

As for the governments not having their own cash that is correct they do have to raise it through taxes. But when one looks at the amount of money that is wasted then one should ask questions. The other thing to bear in mind is that when companies fail, for whatever reason, then it is the governments that have to pay out. So there has to be a balancing act between income and expenditure, if haulage companies fail, then there is unemployment, thus expenditure on the part of governments and loss of revenue. Quite honestly until governments realize that they cannot use the motorist, be they private or commercial, as a milk cow then this situation will prevail. It will come to the point, one day, when everybody says “enough is enough” and cuts down on the fuel they buy – result lower revenues for governments. Isn’t better to have 50% of £100 than 80% of £50, just a thought.

 

The whole political issue on tax and revenue is so large it can not be covered here however one way or the other, the Government will raise the tax it needs/wants. If by some complete injustice the French Government (again) acquiesce to a militant group and therefore reduce there revenue raising ability they have with fuel, then they will just raise a tax somewhere else, or, more importantly it seems to the French, start to cut back on services!

 

Maybe this will go someway to explaining the situation as we see it.

 

Likewise….

 

Wiggo…………

 

PS: Don't you just love a good debate?

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Re: A Looming Fuel Crisis in France?

 

Irrespective of the right of hauliers/ farmers or whoever to exercise their right to disrupt life, when it starts affecting your children's health, you get angry.

 

Chris, hauliers, farmers or whoever may well have and with all our blessing, the right to protest, they have no rights however to put yours, mine or our children’s lives/health in danger!

 

Its interesting tho that comparatively little attention is paid the fuel companies who make immese amounts of money from us drivers. No one begrudges companies making reasonable amounts but didn't the French company Total announce rather large profits yesterday.... or is that ok?

 

Of Course it is OK, they pay tax on it. BP recently announced great results and to everyone’s surprise so did Shell, but when you look at $billion dollar profits you have to also look at the capital employed to make that money and to a lessor extent the risks associated with it. Identification, exploration, extraction, shipping, refining and distribution, these are massive costs that are not really apparent in any other industry.

 

Its perhaps not just Governments who have a part to play .... but they are an easy target.

 

They are an easy target but with regard to fuel in the UK and it appears from pervious posts in France also, the Government control some 80%+ of the price of the product via the duty so they are the biggest target if fuel prices is your issue! I am not saying they are right or wrong as that is a much bigger debate but the oil companies are responsible for a much smaller part of the total cost, yet, as stated above, it is the Oil Co’s investment dollars that are at risk, not the Governments.

Sure, if you have a problem with fuel prices, speak to your Government, they are primarily responsible for pricing.

 

I still visit France regularly both on pleasure and business but I promised myself I would take my business elsewhere if I ever suffered in the same way again.

 

Would it be that easy to “take you business elsewhere” Chris?

I am just being nosey!

 

Planning to be in Brittany again for a week starting 20 Sep and hoping for a positive business visit. Perhaps I will be lucky?

 

They do say that the harder you work the luckier you get!

 

Wiggo………….

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Re: A Looming Fuel Crisis in France?

 

Wiggo

 

Fully apprecaite your points.

 

No, it would not be easy to take business elsewhere, and quite honestly there is not a great deal to take. BUT, when protest turns into lawlessness and I am affected and (certainly in the past, feel threatended), then I can and will go elsewhere whatever the so called justification is.

 

End of rant.

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