TORONTO, (June 15, 2005) — It’s that time again when the Freight Carriers Association calls on truckers to implement a freight rate increase — this time it’s 5.8 percent.

The Fort Erie, Ont.-based agency says the driver shortage, insurance, equipment, and security costs, as well as the pending change in Hours of Service regulations in the U.S, are just a few of the challenges costing the trucking industry — costs carriers need to recoup.

Even with a pass-through of these increased costs, the Canadian trucking industry’s financial position does not meet the required operating margins, FCA says. Based on Statistics Canada’s cumulative 4 Quarters results for Top General Freight carriers, the industry requires a revenue improvement of approximately 1 percent.

The demand for accessorial services is stronger, says the firm. “The costs associated with services such as appointment deliveries, waiting time, border crossing, return of pallets and handling of dangerous goods cannot be absorbed by the trucking industry as customers often expect,” it states. “The trucking industry must charge for these and all the services it provides in order to make the profit required to attract investors and provide adequate capacity to its customers.”

The Tariff Advisory Committee (TAC) of the Freight Carriers Association (FCA) meets periodically to monitor economic conditions as well as the latest statistics on the profitability of general freight carriers. After a thorough review of the information, the Committee recommends an increase in freight rates of 5.8 percent to become effective May 15, 2005.

It is also important to note, FCA stresses, that the cost increases noted exclude the impact of the fuel cost increases. “Experience has shown that the most efficient method of handling fuel cost increases is through the use of a fuel surcharge program,” it says. “The shipping public has recognized the need for the current fuel surcharge. This is the reason that the impact of changes in fuel costs has been excluded from this rate increase recommendation.”

The FCA represents freight carriers operating throughout Canada in matters related to economics, pricing, finances, costing, as well as motor carrier statistics. The firm can be reached at
905/994-0560.