Truckers could mount fuel blockades

SkepticOne

http://www.rte.ie/news/2008/0612/fuel.html

The meeting ended with a suggestion that truckers could mount a blockade to highlight their grievances.
Truckers say they can no longer continue to absorb the extra expense and that they need a surcharge.

My question is this: hauliers are private businesses. Why don't they just charge more to cover their costs? Freight companies would be forced to pay them regardless. Are they scared of foreign companies taking their business?


Perhaps someone with knowledge of the industry could comment.

mike65

They are being told to fupp off by those they contract for.

Mike.

SkepticOne

mike65 wrote: »

They are being told to fupp off by those they contract for.

Mike.

I know, but the issue is what are the freight companies going to do without hauliers? If costs to hauliers have gone up across the board then those costs will be passed on. Freight companies have no choice but to accept it.

mike65

Its a ( somewhat desperate) market - the contractors are banking on enough hauliers
being willing to run at break even (at best).

I dunno that blockades will achive much. A 48 hr strike out of the blue would be enough of shock to the system these days as no-one carries more than a fews days of stock.

Mike.

El Stuntman

I was listening to newstalk this morning and the President of the Road Hauliers Association (Jim Devins?) was on whinging about the high cost of fuel and threatening boycotts etc. He repeatedly said that the government need to be 'imaginative' in finding a solution.

The presenter then asked him what he would suggest and his response basically consisted of 'um,err, something imaginative!'

says it all really :rolleyes:. There is feck all the government can do, given the current constraints on our public finances...

mike65

They could allow a switch to "farm" diesel rates but won't.

Mike.

Fratton Fred

They would be better off going to the middle east and blockading OPEC countries rather than blockading depots.

Most of this is market forces (albeit artificially created) and there is little this, or any other, government can do about it.

SkepticOne

mike65 wrote: »

They could allow a switch to "farm" diesel rates but won't.

If what the hauliers are alleging is true then this would only ease things temporarily. They are saying that the freight companies in many cases are adding on a fuel surcharge to the prices they charge their customers but not passing this on to the truckers. The freight companies are conspiring to keep payments low to the hauliers while charging high prices their customers. If the government switch to farm diesel or otherwise lower taxes on fuel, what is to stop the freight companies from lowering prices to hauliers?

My view is that even with higher fuel costs, there is still a need for goods to be transported from place to place. If consumers want goods they are going to have to pay for them. Hauliers are only going to operate at a loss for so long. Consumers can either pay through higher prices or through higher taxes generally

But before going down the route of higher taxes then we need to know why the market is not operating efficiently. If the market is not operating then removing taxes on fuel won't be effective.

What I suspect is happening is that behind the scenes there's massive price fixing going on between representatives of the freight companies and representatives of the hauliers. This suited hauliers when costs were low, but when they rise they're still stuck in agreements set some time ago and freight companies are sticking to them, hence the threatened action.

Maybe someone in the business could comment.

Alun

No wanting to sound ignorant, but what's the difference between a "freight company" and a "haulier" .. aren't they one and the same thing?

SkepticOne

Alun wrote: »

No wanting to sound ignorant, but what's the difference between a "freight company" and a "haulier" .. aren't they one and the same thing?

I believe the haulier is the individual trucker or small company with a number of trucks. A freight company will contract out jobs to these hauliers.

lostexpectation

see spain bought in the riot police to clear them, a couple of trucker run over doing trucker v trubkker clashes

A Dub in Glasgo

This is the free market in operation. It happens a lot in the buiding trade where sub-contracting is rife

Dirk Gently

SkepticOne wrote: »

If costs to hauliers have gone up across the board then those costs will be passed on. Freight companies have no choice but to accept it.

Not exactly. There is a lot of squeezing going on at the moment. Hauliers get desperate, undercut each other and do what they can to stay in business. Workers lose their jobs, overtime is traded for time off and all costs are cut in an effort to keep the business going. The economy hits everyone, contracts are renegotiated down and there's less money all round. Right now hauliers need work, of which there is less to go round and the cost of carrying out the work is greater. Many are running at a loss and reserves to carry the operation are running out. You can demand to pass the costs onto the Freight company but the freight company will give the work to your more desperate competitor.

This is why a united protest is organised. Squeaky bum time.

SkepticOne

clown bag wrote: »

Not exactly. There is a lot of squeezing going on at the moment. Hauliers get desperate, undercut each other and do what they can to stay in business. Workers lose their jobs, overtime is traded for time off and all costs are cut in an effort to keep the business going. The economy hits everyone, contracts are renegotiated down and there's less money all round. Right now hauliers need work, of which there is less to go round and the cost of carrying out the work is greater. Many are running at a loss and reserves to carry the operation are running out. You can demand to pass the costs onto the Freight company but the freight company will give the work to your more desperate competitor.

If there is squeezing as you say then the government easing tax on fuel won't help as the freight companies will just lower prices further to compensate. The freight companies will always seek the lowest price. If there are too many hauliers seeking too little work, as you say, then they will still try to undercut each other and drive prices down even if the government cuts fuel prices.

So it is not really about fuel as far as I can see. What then are they protesting about?

Dirk Gently

SkepticOne wrote: »

If what the hauliers are alleging is true then this would only ease things temporarily.

True, it's like grasping air while waiting to be rescued from drowning. every breath counts.

They are saying that the freight companies in many cases are adding on a fuel surcharge to the prices they charge their customers but not passing this on to the truckers. The freight companies are conspiring to keep payments low to the hauliers while charging high prices their customers. If the government switch to farm diesel or otherwise lower taxes on fuel, what is to stop the freight companies from lowering prices to hauliers?

There is truth to this but in their defence they have costs too and need to survive. A contract managers role is to screw the contractor and keep their companies cost low and profit high (or in this climate stay afloat). If they can get away with charging a fuel charge and keeping it for themselves they will do it. That's their job, as well as reminding contractors they make the rules and they change them at will. Think comical ali and you have some grasp at what these people are like.

My view is that even with higher fuel costs, there is still a need for goods to be transported from place to place. If consumers want goods they are going to have to pay for them.

Consumers increasingly can't afford goods.

Hauliers are only going to operate at a loss for so long.

... until they go bust.

Consumers can either pay through higher prices or through higher taxes generally

Not a great way to stimulate a depressed economy.

But before going down the route of higher taxes then we need to know why the market is not operating efficiently. If the market is not operating then removing taxes on fuel won't be effective.

It's a chicken egg thing. cut tax, stimulate growth. result = less tax intake or more tax intake depending on how much growth thee cut stimulated. Again we are in recession, inflation is rising as well as interest rates. It would have to be a hell of a tax cut to kick start that economy. Can you risk the public purse on a gamble like that? It's one for the number crunchers and clairvoyants but I don't think the hauliers will get their tax cut. From their point of view though (perhaps not the nations) it is a legitimate request.

What I suspect is happening is that behind the scenes there's massive price fixing going on between representatives of the freight companies and representatives of the hauliers. This suited hauliers when costs were low, but when they rise they're still stuck in agreements set some time ago and freight companies are sticking to them, hence the threatened action.

I think you'll find the suppliers dictate to the contractors. What's happening now is that including rising transport costs we also have suppliers not paying up. Debts to hauliers are been written off by the freight companies and rates are not being honoured. Hauliers can accept this or risk losing the contract.

Maybe someone in the business could comment.

Vehicle recovery, not haulage but the principle is the same:- Trucks - fuel prices - comical alis telling you to fub off as mike puts it.
Current (already inadequate) agreements are not even being honoured never mind anything extra hauliers are looking for.

Fuel price is just one part of the real problem which is - recession. It is a part of the problem though which can be tweaked, unlike the economy as a whole which is pretty much reliant on outside markets and out of the control of the government. Credit crunch / interest rates / inflation / consumer confidence are largely beyond the control of the government.

Dirk Gently

SkepticOne wrote: »

If there are too many hauliers seeking too little work, as you say, then they will still try to undercut each other and drive prices down even if the government cuts fuel prices.

So it is not really about fuel as far as I can see. What then are they protesting about?

Looks like an attempt to join together and make some sort of stand against self destructing by under cutting each other. I don't expect them to be successful I'm just pointing out the desperation of everyone (across all industries tbh). The hauliers are looking to stay in business, they are trying to protect themselves, keep their staff employed and pay bills. It might be like trying to get blood from a stone and might not be in the public interest (public fund wise) but it is in the interest of the workers involved.

mike65

The sh1ts hitting the fan across the water now, with a 4 day fuel truck strike.

Mike

SkepticOne

From what has been said, it seems like the Government in Ireland needs to stand firm for the sake of both the country as a whole and the truckers. As clown bag points out, the truckers are being squeezed by the freight companies, there are too many truckers chasing too little work, and truckers themselves are undercutting each other. Reducing duty on fuel is no solution to any of this.

As also pointed out the real problem is that the country is going into recession. If the government reduces tax on fuel they must make up for it in some other way or else cut back on public spending. Each of these has the potential to damage the economy and damage businesses including haulage companies.

meathstevie

I really have to admire the naivety of some people's belief in the so called free market here. In the end we're all being rode by the Wall Street cowboys and their skulduggery. Has anyone ever contemplated the fact that when all is rosy it's free market left right and center but when things go down a bit too steeply too quickly the ayatollahs of the free market close their own kip for a while until the renegades realise what team they're playing for. And don't forget for one moment that the same crowd who's booking steady losses in the what's now and has been for a while a virtual reality of stocks and shares have been booking solid wins in commodity trading. And by the way, who caused the credit crunch through dodgy lending practices ? Ah sure, no worries. The boys will forsake a couple of million in bonus payments for a few quarterly terms and as for the mess they created a creature called Ordinary Joe will bare the brunt like it or not... .

By the way, anyone found the billions of Dollars yet that have gone missing in the administration of Iraq since the same clique took that over from Saddam ?

Red Alert

I have no sympathy for these guys at all. They create traffic and environmental problems, and have single handedly opposed any development of rail freight in Ireland which would be safer, cheaper and cleaner. Then they want to use agricultural diesel, saying it's their right. They make me sick.