Fuel Card News Motoring Updates: UK freight industry uncompetitive

Research by the Freight Transport Association (FTA) shows operating costs for heavy goods vehicles are at an all time high.

According to the FTA, the soaring price of fuel is to blame for the spiralling operating costs and is leaving the UK freight industry struggling to compete with haulage companies in mainland Europe.

Simon Chapman, FTA's Chief Economist, says: "The high price of diesel is the number one concern keeping hauliers awake at night. Fuel now represents around 40 per cent of annual operating costs compared to around a third just three years ago.”

Between April 2011 and April 2012, the increased cost of diesel alone pushed the running costs of a 44 tonne articulated vehicle up by the equivalent of £1,900 per year.

“Whilst operating costs have now reached an all-time high, hauliers face pressure from customers not to raise their haulage rates and are seeing overall levels of activity fall as the economy slides back into recession. As a result, hauliers are struggling to keep their balance sheets in the black, with a growing number having to close their gates permanently," Chapman continued.

UK diesel duty is on average 24 pence per litre higher than the rest of Europe, according to the FTA. A foreign carrier entering the UK with a full tank of fuel can potentially undertake a week’s work using low-cost fuel purchased on the continent, before returning to mainland Europe.

Chapman argues: "There is a compelling case for an immediate cut in diesel duty. Independent research undertaken by the Centre for Economic and Business Research shows a modest 3 pence per litre cut in duty today would be cash neutral to the Treasury within 12 months.

“The loss in revenue from duty would be fully offset by extra revenues and savings on the public purse resulting from more rapid economic growth."

In other news, the Freight Transport Association's Van Excellence Governance Group wants to see vans have a speed limit set at 70 miles per hour and believe companies will see an array of benefits as a result.

Visit www.fuelcards.co.uk and see how you could save you money on your next journey.

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