WA trucking industry hits slump

as posted here
Cortlan Bennett, Business Editor

September 26, 2009 06:00pm

WA'S trucking industry has hit the skids, according to owner-drivers, as the economic crisis bites hard.It's a far cry from a year ago, when the resources boom created a driver shortage and a flurry of new-truck sales.

Drivers say the double whammy of the global financial crisis and the end of the Beijing Olympics _ which had created a huge resource demand for infrastructure projects _ have forced many out of business and others to ruthlessly undercut each other.
Lesmurdie owner-operator Steven Marijanich said some drivers had seen the warning signs, but many had ignored them.
``People think the money's going to last for ever and then they go out and buy all the brand new gear and all of a sudden, boom!'' he said.
`I've been saying it for years _ as soon as the Beijing Olympics were over, everything stopped.
``People laughed at me, but it happened. There was no more demand for steel and iron ore out of China.
``A lot of local industry just stopped _ I think it shocked everyone _ because since October, things have just been dead.
``We're earning about 40 per cent of what we were last year and some would be lucky to be earning that.''
Huntingdale-based A&F Transport is really feeling the pinch.
The husband-and-wife team of Arthur and Fiona Wheatcroft bought four trucks during the boom, in addition to the one Mr Wheatcroft was driving, and set up their own transport firm.
But being close to $1 million in debt, and with only enough work for one truck a few days a week, they're on the brink of collapse.
``It's bad. It's really bad,'' Mrs Wheatcroft said. ``It's been bad from October last year.
``Apparently when the Beijing Games were on, everything got shut down over there _ all the steel mills _ and they're still not running at 100 per cent.
``It's been a double-whammy for everybody.
``During the boom, we were making up to $4000 a truck each week. Now we've got one truck going and it's not even working every day.
``I've actually let all my drivers go because I've got nothing for them.''
``We're not sure what we're going to do. We don't know whether we're going to fold or try to persevere and keep going.''
Like many owner-drivers, Mrs Wheatcroft said her husband was so busy during the boom that he bought one truck after another to keep up.
He employed drivers and the next thing he knew he was running his own business.
Mrs Wheatcroft quit her full-time job at the Health Department to run the administrative side.
``If I had a crystal ball, I wouldn't have given up my job,'' she said.
``We're not the only ones _ don't get me wrong _ there are so many people out there in our position.
``They're all saying it's the worst the industry has even been in.
``It's a nightmare. So many of our friends have folded.''
Casuarina owner-operator Peter Swift said many ambitious drivers had themselves to blame.
``Everybody said the boom was going to last 10 years _ it lasted five,'' he said.
``The last one was the biggest and everybody was greediest.
``A lot of the industry has got itself to blame. Blokes who had one or two trucks now have 20 trucks and they're out there now trying to turn work over.
``It's pretty hard. What's happening is work's got that quiet that the general blokes are jumping into our (specialist) work and cutting the guts out of it.''
``I can ride it out, but it just irks me that there's work there but you just can't do it for the rates that are offered _ the big companies are dictating the rates now.''
Mr Marijanich agreed.
``Blokes are taking loads to Port Hedland and then they're sitting there waiting for a backload to make up the money they lost going up there,'' he said.
``And they're sitting there for two weeks, waiting. They still have to make money and so they flog each other for the work.''
Mr Swift said bigger companies were also squeezing out smaller operators.
``With Gorgon, they brought Linfox (Logistics) in from over east, but they haven't got a very good record of looking after sub-contractors,'' he said.
Linfox confirmed this week that it had secured the transport contract for the Gorgon gas project, but there were no jobs for WA drivers yet.
However the company said that would change as the project got closer.
Transport Workers Union WA spokesman Tim Dawson said there was no doubt truckers were ``doing it hard'', but he was hopeful new resources projects would create more work.
``There's no doubt some of these projects in the North-West are going to help, but it doesn't help the bloke sitting at home now when they're threatening to repossess his house or his truck, does it?'' he said.

as posted here