Supplementary memorandum submitted by
The Road Haulage Association Ltd
I have been giving the matter of over capacity
in the haulage industry some further thought, especially as this
issue occupied some time at the recent hearing.
The DETR have come up with a figure of 20 per
cent over capacity but none in the industry know how this figure
was arrived at. During my session with the Committee I pointed
out that in such a diverse industry as road haulage embracing
as it does tippers, bulk carriers, refrigerated vehicles, tankers
and general haulage it would be very difficult to identify where
endemic over capacity exists. Coupled with the monthly and seasonal
cycle of the industry and this makes it even more problematic.
In discussions with colleagues I believe that
if the 20 per cent figure can be substantiated then such a percentage
is not really excessive. In any commercial free enterprise activity
there is always going to be some degree of over capacity. The
airlines, high street supermarkets, the drinks industry, motor
manufacturers, all are examples of sectors that have a theoretical
over capacity. The railways too suffer from this with excess capacity
at off peak times yet they have to be equipped to cater for maximum
demand at peak periods.
There seems to be a growing trend amongst economists
that the industry's travails are simply due to over capacity.
We do not believe this to be the case. The high price of fuel
based upon world oil prices and the highest level of fuel duty
has strained the haulage industry's ability to fund supplies.
This is the root core of our problem.
6 November 2000