Battle over fuel surcharges

Freight carriers reeling under record diesel prices are trying to head off Commerce Commission efforts to stop them imposing fuel surcharges on customers.

The commission is warning land transport operators they are not exempt from a court judgment against Air New Zealand advertisements which omitted surcharges from listed fares.

Auckland District Court judge Stan Thorburn, in his ruling in November on 14 of 20 sample charges, said fuel was a normal operating cost of business and must be included in prices.

His verdict, which Air NZ left unchallenged, has prompted 12 complaints to the commission against other companies from customers and competitors for adding extra charges for fuel to pricing schedules.

Fair-trading director Deborah Battell said the commission had since contacted 70 businesses, mainly in the road transport industry, and found 32 imposing extra charges for fuel.

These ranged from 1.4 per cent to 10 per cent of total prices.

She said the Air NZ judgment was clear, and that charging for fuel as a separate cost gave a false impression of prices which made it difficult for customers to shop around.

"Competitors who don't impose the charge are also disadvantaged," she said. "If businesses continue to impose fuel surcharges they risk prosecution."

Ms Battell was yesterday reluctant to disclose the commission's next move against offenders, saying it first wanted to consider points to be raised by the Road Transport Forum at a meeting with it next week.

She said offenders caught in the commission's trawl included trucking firms, couriers and one taxi company.

Transport forum chief executive Tony Friedlander, representing freight operators, said legal advisers from both sides would be at the meeting.

He hoped they could find a freight pricing formula "that complies with the law but also recognises the way the industry operates".

"We are dealing with huge fluctuations in fuel prices and seek to be as transparent as we possibly can towards our clients," he said.

Mr Friedlander said freight firms differed from airlines as they did not advertise their rates publicly, preferring to set contracts with individual customers based on the types of goods to be carried among other factors.

"It is not like Air New Zealand where there is the potential to mislead the public."

Freight customers were given clear details of fuel components of prices offered, and he hoped the commission would allow that practice to continue in some agreed form.

This gave customers confidence that prices would come down when diesel became cheaper.

With the price of diesel at an all-time high this week, at $1.06c a litre at most pumps, the transport forum is waiting for a report from an independent analyst it has hired to scrutinise seemingly high oil company importer margins.