Transport sector facing mounting costs pressures

Transporting NZ says 400 transport companies were surveyed and nine out of 10 said costs had gone up.

Nine in 10 transport operators say recent cost increases have had a major negative impact on their business, industry group Transporting New Zealand says.

It is pointing the finger at surging oil prices, saying operators are "facing cost pressures like never before".

Transporting New Zealand chief executive Nick Leggett says they are concerned about the survival of some businesses.

Transporting New Zealand chief executive Nick Leggett Photo: RNZ/ Tom Kitchin.

"The nearly one in five businesses who report they are unable to pass on increased costs to customers obviously face the greatest threat.

"We are raising the alarm given the fragility of our supply chain. The trucking industry carries 93 per cent of freight so these survey results really go to the heart of supply chain vulnerability.

"Simply put, if operators can't make their business viable, trucks don't move, and if trucks don't move, shelves don't get stocked."

Transporting NZ says 400 transport companies were surveyed and with nine out of 10 saying costs have gone up, "unsurprisingly, fuel has been the major cost increase".

A year ago, only 20 per cent of the industry has fuel making up more than a quarter of their business costs, it says.

"Today, 64 per cent say fuel is more than a quarter of their costs. A total of 45 per cent of operators say fuel is now in excess of 30 per cent of their costs; a year ago that was just eight per cent."

-RNZ.

2 comments

Inflation

Posted on 11-07-2022 15:51 | By Kancho

Not sure why added costs can't be passed on as it seems the only solution. This if course will add to inflation. Sadly we pay high GST in goods and services than many countries and worse we pay on tax on essential food unlike many countries. We also still pay more tax on fuel than most countries. As everything increases in cost the government gleefully take fifteen percent on higher amounts so even more into their coffers. Surely these taxes hurt those struggling even more. Poverty hasn't changed in the five years of government and many will know from experience it's actually worse.


Even more

Posted on 11-07-2022 15:57 | By Kancho

The cost of fuel is only one part of cost for businesses. There is the extra statuary holidays added and extra leave and sickness leave etc. And at a time of skilled drivers and minimum pay pushing all wages up to retain some relativity for skills. A perfect storm so costs must go up and be passed on or lose capacity in our countries logistics for delivery of everything


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