As 2010 draws to a close we can look back on a year that was better than 2009 and in some ways more so than was expected. New truck sales improved, manufacturing and mining achieved some growth and retail sales reflected an increase in consumer spending. Unfortunately the rate of improvement sagged as the country entered the third quarter. However, 2010 is more likely to be remembered as the year of lost opportunities. The implementation of urgently needed transport and traffic legislation, mainly in the form of the long-awaited AARTO Act and its accompanying overload control project, once again stalled at the starting blocks and remain on the backburner to be revisited at some promised future date. This and the sudden unexplained cancellation of the proposed final DoT Workshop to develop a new and appropriate strategy for road freight logistics in South Africa merely adds to widespread loss of credibility in traffic law enforcement, especially when seen against the background of reckless and mainly ill-informed media comments about AARTO suggesting transporters will be bankrupted and drivers will lose their PrDPs and licences.

At the time of writing there is still no finalisation of the cleaner fuels strategy for South Africa. This leaves the motor and oil industries in the dark as to what fuels will be approved, whether Petro SA will get government’s backing to build its planned 400 000 bpd refinery in the Eastern Cape or finalisation of the draft biofuels strategy. 2010 was supposed to be the year of consolidation; however, the DoT and the RTMC seem to be in competition, or at loggerheads, when it comes to tackling unresolved issues around eNatis and other traffic and transport regulations that need to be resolved soon.

Transporters confirm that operating costs through the year were reasonably contained and did not amount to much more than inflation. There is more concernabout short supply of tyres, replacement parts and new vehicles. Not all suppliers blame the protracted Transnet strike and subsequent motor and tyre industry strikes. Some say they under-estimated the market and did not order enough or in time to secure stocks when the market suddenly picked up.

Of greater concern to transporters is the lack of volume, this particularly so in foodstuffs and certain agricultural produce and products. Apart from a general slow down in consumer spending, the strong rand stimulates importation of food and food products.

A good example is unlimited importation of UHT milk and other dairy products that impose a negative impact on local production and the ability to process all available raw milk. Congestion at ports, retail outlets, road construction and traffic grid-lock in and around metro areas effectively restricts transporters to about 700 kilometres a day. Weak freight rates, especially for long distance dry and perishable freight makes covering at least 180 000 km a year mandatory if transporters are to cover costs. According to financial service providers the recession has seen a large number of transporters and fleet owners dig deep into their respective balance sheets in order to remain solvent.

The demise of literally hundreds of SMME operators, many of them newcomers with little meaningful experience or expertise, went belly-up leaving a massive trail of repossessions that has devastated the value of used trucks. Used truck traders say there are no reliable business sources locally and are looking north of the border to move some of the iron in order to generate some urgently needed cash flows.

Not all vehicle, trailer and truck body suppliers had a lean year. Some report full order books especially as the year started drawing to a close and more vehicles were needed to move the customary festive season logistics. However, none we spoke to report an improvement in bottom line performance. The market remains intensely competitive and price sensitive. Suppliers generally predict that come January 2011 prices will have to move up - albeit, modestly.