South Africa Diesel Cost Surge of 32.5% Puts Road Freight Sector under Immense Pressure
For the road freight industry, the daily basic diesel cost rose by 32,5% this week. That’s an increase of 32,5% of a basic cost input that is between 35% and 55%, depending on the vehicle type used, routes used, congestion, working conditions and fuel consumption.
Whilst not being raised by R10 per litre, the R3 that is being “decreased in the fuel levy” definitely helps – but it will come back in some form or another.
Road freight operators are under immense pressure. There are no guarantees that clients will pay the new transport rates, and transporters are in the business of making money, not in the business of making a loss.
Access to cash reserves to pay for high fuel costs is every transporter’s worry – where to find the funding for day-to-day operations or guarantees with fuel suppliers.
Consumers will start feeling the pinch of high fuel prices within a couple of weeks, and fuller impact will filter through towards the end of April.
