16th April 2008
Escalating Fuel Costs
The frightening rise in fuel prices continues to be a source of alarm to NAAC membership.
As a sector that relies heavily on the use of diesel for our off-road operations
(be that red or white) we must keep a close eye on our business costings. It is only too easy in the current
climate to find out-goings larger than income and it is vital that we, and our customers, recognise the
massive impact.
In 2005 we were paying 34ppl, yet today we are facing 54ppl. Based on cost-calculations, with all else equal in terms of annual hours worked plus spares/repairs,
the operating costs per hour for a 140hp tractor have soared from £8.38 to £13.10.
When you add in the fixed cost for the tractor of £7.14 an hour, the total hourly cost jumps from £17.13 to £20.24.
However, we have the operator to be paid as well, not just for the hours he or she works but also for the hours
they are out of action due to sickness or holiday. When the regular operator cannot drive, someone else has to
step into the breach and they expect to be paid too. Currently the operator cost in any budget should stand at
£11.50 an hour. Add this to the tractor costs above of £20.24 and you come to an eye-watering £31.74 an hour
before the tractor has even moved!
Terrifying when we consider our 2005 member survey gave us a figure of £23 per hour including a trailer!!!
This massive hike simply cannot be borne by our businesses and must be passed on through our charging structure and the
NAAC will do everything possible to get this message across to your customers.