Long haul or short, trucking prices going up

If you ship your magazines anywhere in Canada by truck, be prepared to pay more for it, says David Bradley, the CEO of the Canadian Trucking Alliance and President of the Ontario Trucking Association. He told the annual freight and distribution conference of the Book & Periodical Council* that there are a number of reasons why operating expenses and consequently prices are going up.

• The major reason is the shortage of truck drivers, which is only going to get worse.Improved compensation for drivers will be a part of the long-term solution to the driver shortage, said Bradley. “Wages, which are a carrier’s number one cost component, are under upward pressure, but so are all of the other major cost components.”
• Fuel costs are up over 25 per cent since the beginning of the year – and over 60 per cent in the past two years, Bradley said, adding the introduction of ultra low sulphur diesel fuel will likely add several more cents to the cost of fuel per litre and will have less energy content than existing diesel.
  
• As well, the new, 2007 smog-free truck engines will enter the market this fall and are expected to cost up to $10,000 more to purchase as well as being more expensive to operate and maintain.
• “And a lot of the costs and responsibilities for secure border crossings, which should be shared, are being placed on the backs of motor carriers,” said Bradley. “While the industry began to repair its balance sheets over the past couple of years, profit margins are not anywhere near thick enough to be able to absorb these kinds of cost increases.”


*The BPC is an umbrella organization of major Canadian and North American book and magazine publisher, distributor and wholesaler associations. Since 1982, BPC has had a Freight Plan for its members that negotiates freight rates and service, establishes benchmarks in pricing and value-added services, and disseminates useful industry information.