Be ready for Garnaut price rises says ATA

The draft report of the Garnaut Climate Change Review confirms that every trucking company must have a system to pass increases in the cost of fuel on to their customers, the Chairman of the Australian Trucking Association (ATA), Trevor Martyn, says.

The draft report proposes that the transport sector and fuel should be included in Australia’s emissions trading system.

If the Government adopts the report’s approach, the price of diesel will increase when emissions trading starts in 2010.

“Many trucking companies are already struggling to cope with the rapidly rising price of diesel, which has gone up by 50 cents per litre since last October,” Martyn says.

“One estimate is that emissions trading could increase the price of diesel by another ten cents per litre, although the draft report does not include updated figures.”

“It is essential that every trucking company puts a system in place now to pass on increases in the cost of fuel.”

The ATA is urging every operator in the industry to:

• understand their costs and review them every week;
• negotiate with their customers to increase their freight rates or impose a fuel surcharge.

Some companies need to immediately increase their freight rates by more than 20 per cent; and – refuse to accept jobs that do not pay enough to cover their costs.

“These three steps will enable operators to get through the rapid price increases that are battering the industry now,” Martyn says.

“They are also the key to getting through the introduction of emissions trading in 2010.”

Martyn says that including the transport sector in emissions trading was better than the alternative — more regulation.

“One way or the other, the trucking industry will be required to contribute to reducing Australia’s greenhouse gas emissions,” he says.

“The advantage of emissions trading is that the industry and our customers will be able to make our own decisions about how to deal with the increased price of fuel.”

“For example, some of our customers may decide to consolidate their deliveries.”

“Many operators will choose to use bigger trucks, and the ATA will continue to press governments to allow the industry to use B-triples between Australia’s capital cities.”

“The alternative is more regulation, with stringent engine requirements and attempts to force our customers to transport their freight by rail or sea, even if those transport modes do not meet their business requirements,” Martyn says.