Fuel costs to impact on charges

Wairarapa businesses with a high reliance on fuel have warned the crunch is coming for consumers in the wake of soaring petrol and diesel prices.
Petrol prices have rocketed to record highs in recent weeks, and local companies who rely on fuel to run their businesses say the costs cannot be absorbed any more.
Ten months ago the Times-Age canvassed a number of businesses with a high reliance on fuel, and the consensus was that rising costs were becoming harder and harder to absorb.
Today, with diesel at $1.22.9 a litre and unleaded at $1.67.9 a litre, businesses can absorb no more, and to stay afloat must pass on the costs to customers.
Fred Burling, of Burling Transport in Masterton, said the cost of operating was causing real problems.
"I don't know where it's going to end ? it's got us stuffed. All joking aside it's costing us $1.60 a kilometre just for fuel and road user charges.
"We've got to [pass the expense on to customers]. Otherwise we might as well park up."
He said if things were going to carry on like this ? and he said he was told 10 months ago he'd eventually be looking at $2?$2.50 a litre for diesel ? road user charges for trucking companies should be scrapped.
"That costs us $.54 a litre. It's just going to stop industry. They should wipe the road user charges to compensate us."
Passing the costs on isn't as simple as it sounds though, and Mr Burling was having difficulty getting his message across to some of the people he services.
"In the logging industry we're not getting our rates ? the forestry people won't give us an increase.
"It's the old story ? everybody gets screwed. If every truckie decided to stop and pull the pin for 14 days, see what would happen in New Zealand then."
In the people-moving business, Tranzit Coachlines Wairarapa manager Les Cockeram said the company would be looking closely at fares in response to the petrol hikes.
"We're going to have to look at our individual fares, especially to Palmerston North."
He said the urban services Tranzit provide, in and between the Wairarapa towns, are tied into a fare structure with the regional council and can't just be changed on a whim.
"You have to apply to the regional council for any fare changes, and they have put together a uniform fare for the whole Wellington region."
He said one facet of the business they are able to change is with charters.
"We can adjust our pricing there and have done in the past 12 months.
"You'd be looking at a rise of 5 to 6 per cent for a charter job to Wellington. For example a job that went to Wellington last year that might have cost $500 would be $30-$40 extra today.
"You have to pass it on somewhere."
He said the fluctuating price of the past 12 months has seen the company stop holding bulk fuel supplies.
"The price was up and down so much - that was why we elected to go away from our pump.
"You'd buy fuel at the top and 24 hours later it would drop down and you're left with a whole load of expensive fuel."
McAuley's Transport Ltd managing director Colin McAuley said the company absorbed rising petrol prices for a year, but in July 2005 built a percentage into the bill to cover the costs.
"If you don't deal with it you end up going bankrupt. It's now at the stage that if you don't keep up with it will get on top and you'll be adding 10?20 per cent on top of your prices."
He said the company's fuel bill has doubled in the past year, and if they didn't cover those costs they wouldn't be able to maintain their trucks.
"And then accidents happen."