APPENDIX 15
Further supplementary memorandum submitted
by The Road Haulage Association Ltd
RESPONSE
TO QUESTIONS
FROM THE
COMMITTEE
I have pleasure in replying to your facsimile
on follow up questions subsequent to my oral evidence to the Trade
and Industry Select Committee's inquiry on road haulage costs.
Q145 A particular example can be seen between
Palletline Plc, a nation-wide hub and spoke distribution system
for palletised cargo with its central facility in Birmingham,
and one of their customers Parcelforce, a business of the Post
Office. Although Palletline have a clause in their contract allowing
them to approach their customer for an agreed formula of rates,
increased on an annual basis, Parcelforce were not prepared to
entertain paying increases in full. The last increase requested
was for 6 per cent (to cover mostly fuel price rises) but Parcelforce
were only prepared to offer 3 per cent. Reluctantly Palletline
had to accept this, but noted that in so doing their margins were
severely eroded.
Q148 The evidence we have is necessarily
based on information our regional offices receive. Our Bristol
office for instance reports that in July and August of this year,
the Help Desk reported a steady increase in redundancy enquiries,
which have now levelled off but continue at a rate of 2-3 per
week. Most of these enquiries are in the lines of "I am either
thinking about or might have to make some redundancies in the
near future—what do I need to start doing in preparation?"
H Hancox (Haulage) Ltd and Hampson Haulage Ltd are two operators
who have had to make redundancies in the recent past. Both their
fleets have had to be cut back drastically.
Q172 Instances of return loads are rife.
One specific example is a large brick company that put some West
Midlands to Belgium work out to tender. Barry Proctor Services
Ltd needed £650 per journey to make it pay. A Dutch company
(Smeets) got the work for £275. Another foreign haulier's
bid was £412. All these prices include ferry costs.
Apparently, the ratio of inward work to outward
work is roughly 3:1. Thus, the inward work commands much higher
prices than the outward (return) work. Therefore, UK hauliers
have great problems in getting the outward (primary) work.
Q174 Mr Clive Hampson reports that foreign
operators are now doing a lot of his UK internal distribution
work. We understand that multi-national companies for example
are asking for foreign tenders for internal work, but actual names
are difficult to identify because of issues of confidentiality.
30 November 2000
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