Before I get to discussing the economic downturn, this week has seen some positive historic events for our organisation. On Wednesday, following a lot of work from our members and directors, our two North Island regional associations unanimously approved the adoption of our new constitution. Our two South Island associations will hold similar meetings in the coming weeks.
Subject to the outcomes of these two meetings, the Transporting New Zealand Board and Regional Presidents will gather in Wellington later in the year to formally adopt the constitutional and governance changes.
These changes will ensure our organisation is able to keep delivering for our members, improve our sector advocacy and events, and allow our member volunteers and staff to focus more on achieving wins for industry. The current economic slump makes this more important than ever.
The state of the economy
At our annual conference in Lower Hutt last year economist Cam Bagrie gave the industry the hard word.
It was going to be a tough time, he predicted, with inflation, a recession, vast uncertainty, plagues of locusts, all that good sort of stuff.
Well, he was right and things are hitting hard. How hard? Well, one of our regional reps said there were some vacancies at a port last month that he works in with. Usually there’d be about 10-15 applications for a job. The latest adverts were getting 150-200 responses.
A major road freight firm went into liquidation recently with absolutely no warning. Lots of trucks, lots of staff, and the plug was pulled.
One of our Wellington members says her and businesses she associates with are now in “Survive to ‘25” mode.
Industry lenders are increasingly getting customers asking to go interest-only on business loans, as revenue dries up.
But I don’t need to tell you how fierce things are, you’re living the reality every day.
And it’s not just limited to our sector. The hospo trade is up against it in a huge way, retail’s suffering and even breweries are closing down. Which is never a good sign.
The one industry that’s not letting up is the enforcement sector, with transport companies being pinged for things that they don’t have effective control over.
A recent example was a carrier who had a $280 job transporting some deer. Some of them were missing ear tags so the company’s been fined $1200.
Going after transporters on this issue strikes me as the wrong approach. In reality, responsibility for tagging and tracing rests with the farmer or livestock owner. MPI’s education and enforcement should be targeted at the responsible link in the supply chain. Transporting New Zealand will be discussing this and other sector concerns with Federated Farmers and Minister Andrew Hoggard later this month.
In the meantime, we recommend all transporters insist on farmers completing an Declaration to Livestock Transporter than NAIT animals are tagged and registered – your Get Out Of Jail Free card.
Times are hard, operators are under extreme pressure, and we’ll be escalating our concerns about over-zealous enforcement to the relevant entities and ministers.
Back to Mr Bagrie who was the founder of the ANZ bank’s Truckometer index which measures the economy based on the amount of road freight being carried.
The next one is due out on Tuesday and it might be an ugly sort of figure. Which will be bad news for our sector, and the whole economy.
At the conference Mr Bagrie said “doing business is going to get fun again”.
His version of fun was to measure yourself against your competition and to see who would do well when times get harder. And no, it’s not my version of fun either. But that’s where things are now.
So we have to get smarter and more productive and make sure our members are being treated fairly and justly.
Late last week the industry met with NZTA and the Ministry of Transport for a policy workshop with and we hope this is the start that will deliver some of those productivity benefits.
And we’re here to help in any way we can.
