Canadian Trucking Alliance

Canadian Trucking Alliance

October 07, 2005 13:00 ET

Canadian Trucking Alliance: How Long Before Cost of Food, Clothing Goes Up Due to Higher Transport Costs? National Trucking Chief Points to Sky-Rocketing Cost of Diesel Fuel

OTTAWA, ONTARIO--(CCNMatthews - Oct. 7, 2005) - Consumers are bracing for an increase in home heating costs now that the cool temperatures are returning, but the head of the Canadian Trucking Alliance, David Bradley, says that sky-rocketing diesel fuel costs are adding significantly to the cost of transporting consumer goods and foodstuffs. The trucking industry, which hauls 90% of all consumer and grocery products in the country, is facing record level diesel fuel costs which in turn are being passed along to retailers and grocery stores through fuel surcharges.

"I don't want to sound like the Grinch who stole Christmas, but when you consider that every thing on store shelves has to be transported there, you have to wonder how long before consumers get really hit in the pocketbook," said Bradley. The federal government recently announced a $2.4 billion home-heating rebate plan for low-income families, but what this will not offset the cost of other goods. Says Bradley, "cooler temperatures are not only going to impact home heating costs, but they will also push up the cost of diesel fuel which comes out of the same barrel as home heating oil."

"Consumers already feeling the squeeze at the pumps and in their heating bills may be forced to cut back on other purchases, which would be bad enough for the economy. But, if the price of retail goods and groceries also increase significantly because of increased shipping costs, this could have a further dampening impact."

Bradley said there are things government can do to help reduce fuel costs, "they can reduce the federal and provincial taxes on diesel fuel, like some US jurisdictions have done, even if only on a temporary basis; they can make it less restrictive for truckers to use wide-base single tires, and they can look at a controlled expansion of extended length trucks." And, in one province so far (Ontario) the provincial trucking association is developing a proposal to government to mandate the activation of speed limiters on trucks to better control speed and fuel efficiency.

According to CTA, the average commercial price of diesel fuel in Canada set a new record earlier this week when it jumped to over 73 cents - before federal and provincial taxes. In the last month alone, national diesel fuel prices rose by 16 per cent. And in the last three months, the trucking industry has had to cope with a whopping 40 per cent increase.

The Canadian Trucking Alliance is a federation of provincial trucking associations representing some 4,500 carriers, owner operators and industry suppliers from across the country. Trucking in Canada is a $54.7 billion industry and employs 400,000 Canadians directly.

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