The number of businesses in the road transport sector entering administration has more than trebled over the past three years, with 68 companies going under in the first half of 2024 alone, compared with 20 in the first six months of 2022.
One of the most recent casualties was Cartwright Brothers, a family-run haulage company with an 80-year history – highlighting the severity of the current economic environment.
While fuel prices have receded from their previous peaks, they continue to strain budgets. The cost of vehicle maintenance and repair has been exacerbated by delays in parts delivery, leading to longer downtime when repairs are needed, translating into an increase in lost revenue or vehicle off road costs – a particularly painful hit in an industry where margins are already tight.
Although improved, vehicle supply chains are still not fully recovered and haulage firms are often forced to keep older vehicles on the road for longer, which can increase the likelihood of breakdowns and the associated maintenance and repair costs.
To compound matters, the industry is now facing significant increases in motor insurance premiums, which is adding yet another layer of financial burden.
Managing a fleet is an expensive process at the best of times, so adding in the current economic challenges only heightens costs. However, there are proactive strategies and steps that can be taken to create significant savings.
The installation of telematics systems can provide valuable data on driver behaviour, which can be used to reduce fuel consumption and minimise wear and tear on vehicles, whilst dashcam footage can be essential in determining the correct liability apportionment in collisions with other road users.
Another valuable tool that can help firms claw back costs is uninsured loss recovery (ULR), which is the process of recouping costs associated with non-fault accidents that are not covered by insurance, such as repairs, loss of use or revenue and policy excess charges.
To maximise a ULR solution, it is important to ensure drivers are trained to collect all necessary evidential information at the scene of an accident, including photographs of the damage and the other vehicle involved, especially if is it a company vehicle with a livery on it.
Keeping detailed records and retaining incident evidence can also improve chances of a successful recovery. The impact of failing to do the basics can cost businesses significant sums of money.
Many haulage firms will, rightly, concentrate on the business cost exposure from fault incidents, ensuring efficient notifications to enable third-party capture. However, this is not an either/or – having a proper ULR solution in place is imperative to maximising loss recovery and helping to reduce overall spend.
Ian Evans, partner, loss recovery specialists Corclaim
