Carriers in a pickle— railman

Press, 6 October 1988, Page 3

Carriers in a pickle — railman

PA Wanganui Excess capacity and irrational pricing problems have put the road transport industry into a “terrible pickle,” said a Railways Corporation executive in Wanganui yesterday. Mr lan Ambler, executive manager for Railfreight Systems marketing and operations, told delegates at the Road Transport Association conference that a gulf was developing between rail and small carriers who specialise in long-distance transport. “The road transport industry has got itself into a terrible pickle of excess capacity and uneconomic competition since deregulation,” he said. “Through competition it is passing some of its problems on to

rail with what we see as irrational pricing, especially by small road operators, to ‘buy’ business,” he said.

“It is our perception that a disturbingly large number of road operators seem to believe the way to make profits is to charge a per kilometre rate a little less than the next man, hope it covers costs with a small margin, then overload a bit and drive the truck as many kilometres as you can.

The road transport deregulation experience in the United States suggested the New Zealand process could take up to a decade.