Tom Brown, a director at PMD Business Finance, warned delegates at the RHA Forum for the Future in Birmingham that funding for zero emission vehicles would be hard to come by in the current climate without a "thoroughly thought out business plan”.

"Financial institutions will be looking a lot deeper than they would if you wanted to invest in a diesel fleet," he said. "They’ll look at your internal infrastructure and how you are going to support a net zero fleet.”

Brown added that a main area of concern to underwriters is a fleet's residual value: "That’s where the government need to support investments in zero emission fleets made by SMEs," he said. “A funder might take the residual risk but we don’t really know what that is yet so will be more digging on total cost of ownership.”

Brown advised operators to consult an accountant who specialises in helping businesses with their transition: “And talk to manufactures and dealers about the operational impact of bringing in electric and hydrogen vehicles and start to model that financially,” he added. “Also look at solar panels and LED lighting; the return on investment is a no brainer.”

For more stories tracking the industry journey to decarbonisation see our new Freight Carbon Zero website.

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The confidential service – which operates 24 hours a day, 365 days a year – is staffed by qualified counsellors and aims to help member employees deal with personal or work-related challenges. The programme is run by PAM Wellbeing.

MAP services include in-the-moment confidential support or guidance regarding any personal issues, as well as short-term counselling delivered via telephone or secure video link.

Cognitive behavioural therapy and other mental health programmes are also available via an app, along with referrals to specialised support for debt and legal problems, bereavement, relationship support and trauma.

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However, he also told delegates at the RHA's Forum for the Future that BP’s strategy would see it continue to invest in traditional fuels as well as the low carbon transition

“We believe diesel will still play a major role but with a tipping point for the UK in the late 2030s,” he said. “Electrification will be the primary source of low carbon transport but hydrogen will be a growing part of that mix. The pathway is a bit further out but it will play a crucial role in transport and long-distance haulage.”

Brabazon added that government policy would ultimately dictate the speed of the net zero transition for HGVs and that Germany and China were currently leading the way.

“We are already seeing low carbon subsides for trucks in those countries,” he said. “In Germany they have an e-charging corridor for trucks that is driven by clear investments.

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“In the UK there are important programmes like the Zero Emission Road Freight (ZERF) demonstrator programme and we’re eagerly awaiting the results in the near future.

“These trials are about test, learn, then do. As part of that, we’ve agreed a deal with Daimler to build 25 hydrogen refuelling stations by the end of 2030. BP is currently developing a hydgroen hub at a site in Teeside and we have confidence that truck charging infrastructure in the UK will come.”

Brabazon went on to admit that the pathway for zero emission trucks is more complex that for cars and vans. “It’s a diverse energy mix,” he said. “Bio fuels have a really important role today -  HVO and bio LNG and bio CNG can reduce CO2 emissions by up to 85%. There are instant solutions, so look carefully at your operation and, in a collaborative sense, use specialists to support you.

“BP will need to think differently and so will you,” he concluded. If you haven’t started the race, you need to start. Think – then do, learn – then do.”

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DVSA chief executive Loveday Ryder (pictured) told delegates at the RHA's Fourm for the Future that the organisation was working to build stronger ties with hauliers and asked them to report their peers if they suspected them of breaking the rules: “One of the things I’d like to see more of, and for us to change in our relationship with operators, would be more people coming forward and telling us about non-compliance,” she said. “That would be a huge culture shift from where we are today.  Why isn’t non-compliance as socially unacceptable as drink driving?”

Richard Turfitt, senior traffic commissioner and traffic commissioner for the east of England, agreed: “The important thing to remember is RHA members are bound by the law and so are we. We can only take action if we have evidence. That action often relies on information being passed to the agency, allowing an investigation to happen.

“Your information can directly assist getting shoddy, undercutting operators out of the system through a public enquiry. I rely on you and I expect that of you. As responsible operators, please help me to do my job on your behalf.”

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However, he went on to slam some of their major customers for “an appalling culture of late payment” that is crippling many hauliers.

“If you’re relying on consumer demand, the hold on interest rates means there’s a sense that we’re seeing some light at the end of the tunnel,” McTague said. “However, I can’t think of one small business that hasn’t experienced late payment with big businesses feeling they can abuse their supply chain. More than 50% of SMEs are reporting late payment is getting worse.

“The major impact is that most small businesses have to double their working capital and then lend it to their customers at zero interest. That can’t be acceptable at a time when they’re struggling to invest. If the government is serous about helping smaller businesses this is an issue they have to tackle and tackle now.”

More small businesses are reporting revenue falling than revenue rising, McTague added, with the biggest problems being labour, energy and fuel costs. 

“With energy we’re looking at ways firms can blend and extend contract agreements,” he said. We’re also asking the government to change the VAT threshold and encouraging more apprentice schemes like driver boot camps.”

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“Irrespective of whether it’s difficult for you, it’s happening,” he told RHA Forum delegates. “You are now your customers’ problem. Every major company has now subscribed to the Science Based Targets Initiative (SBTi). That’s 982 companies in the UK including all the major supermarkets and most of them are your customers.

“Some are saying to their shareholders that by 2025, not 35, they are going to achieve net zero. They’re not waiting for the prime minister. They see zero emissions as a competitive advantage to getting more business.”

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Rodrigues also cautioned operators against buying diesel trucks in the next buying round, claiming their businesses would be “worthless in 10 years’ time”.

He urged hauliers that have not started their net zero journey to make plans with their truck supplier and customers and come up with a workable plan.

“When you see how much an electric vehicle is to buy you might think your customers aren’t going to pay for that,” he said. “But for your customer, transport is just a line in their profit and loss account. So the impact of that isn’t the same for them as it is for you.”

Rodrigues also advised operators that the transition could be achieved in stages: “Understand what can be done and don’t do it all in one go,” he said. “Start with maybe a couple of trucks. We sit with operators, we make it work. So you’re then in a position of strength and bring a solution to your customer.”

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Speaking at the RHA Forum for the Future at the Vox in Birmingham, she said the transition remained “a massive challenge for smaller businesses” but that their calls for industry support had been ignored.

“I take our responsibility seriously but I don’t think the larger companies or the manufacturers understand the challenges for the SMEs,” she said. “When you get to the SME level there is no collaboration. We’re forgotten because we’re small fry. Larger organisations collaborate better.

“Manufacturers tell us we need to take it to the customer, and pre-Covid we probably could. But customers are now only looking at price. They don’t care how I get a tipper or a skip to them as long as it comes. They’re not interested in what’s fuelling it.”

The London-based collection and recycling firm has underlined its commitment to reducing emissions by moving its fleet to HVO but O’Donovan admitted a week-long trial of two electric trucks had exposed major problems

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“The first one kept running out of power and the second one couldn’t do a day’s work in London,” she said. “And electric vehicles are double the price of diesel.”

She added that another major concern was how to charge the firm’s fleet of 100 HGVs. “They’re not all going to park in the same spot every night so how are they going to reach chargers? It’s not going to work,” she said. “Then we’re going to have a massive surge and where we’re located won’t be able to cope with that. I wanted to put two 22Kw chargers for the car and van fleet but the power coming in wasn’t big enough and we don’t have the money to pay for more.”

The company is pinning its long-term hopes on hydrogen, O’Donovan said. However, storage remains a problem under current regulations. “If we could have hydrogen in a tank in our yard we’d be home and dry but we can’t,” she said. “And how many hydrogen stations are going to be in London?

“I think more business people should be in the government,” she concluded. “They could get industry leaders around the table for nothing to produce a standard or regulation that’s fit for purpose. The government are in an ivory tower and not business minded.”

For more stories tracking the industry journey to decarbonisation see our new Freight Carbon Zero website.

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Subject to the approval of the competition authorities, Hoyer said the transaction would trigger a strategic growth initiative to strengthen its global performance under the new brand name of Oxalis Logistics.

This would include an investment of more than €100m (£86.7m) into its infrastructure, assets and digitalisation.

The proposal would see a strategic adjustment in the company business models – Global Tank Logistics, Gas and Petroleum Logistics, Supply Chain Sustainability and Intermediate Bulk Containers.

Under the deal, the logistics specialist would hand over its regionally-based businesses of petroleum deliveries for service stations, airports and into-plane services together with regional bitumen logistics to AUCTUS Capital Partners.

Hoyer said the move would provide it with a financially strong partner that will support the further development of its activities to seize new and existing opportunities in the market.

The Hoyer workforce and service delivery to customers would remain unchanged, it added.

The UK remains a core market for the Group, Hoyer said, and the company would continue its activities with the exception of the respective regional petroleum deliveries and bitumen logistics operations.

The announced investment would also see Hoyer offering increased support to customers in the chemicals, gas, foodstuffs and mineral oil industries with logistics solutions across the supply chain.

“With our new partner we will be able to operate more flexibly and, should the competition authorities approve the deal, we will operate under a new name," explained Allan Davison (pictured), director Hoyer gas & petroleum logistics.

"As a whole team, we remain committed to our clients and will continue to serve them to the highest standards, with quality, safety, efficiency and reliability remaining central to our focus."

Added Hoyer chief chief executive Björn Schniederkötter: “Our investment measures will generate added value for all our global transport logistics businesses. Furthermore, with our strong regional representation, we support and understand customer requirements where they are located, bringing a combination of globally consistent standards and local know-how.

"With these investment measures and the further development of our business models, the Hoyer Group is following its principle of long-term sustainable orientation."

Thomas Hoyer, chairman of the Advisory Board of the Hoyer Group said the announcment set the course for the company's future: "As a family-managed business, we have always approached change in a strategic way," he explained. "We think and act globally across our operations in terms of the needs of future generations both within Hoyer, our business ‘family’ of employees, for our customers and ultimately for their consumers. Under the new arrangement, we will be able to concentrate on the further development and direction of all our global activities.”

The post Hoyer set for rebrand after investment deal triggers growth plan appeared first on Motor Transport.

The Trimble-owned software specialist has also announced the launch of Freight Marketplace, a deal-making hub for freight procurement which is of equal benefit to shippers and carriers.

Transporeon’s first new platform innovation is its Autonomous Quotation spot bid tool which allows carriers and logistics service providers (LSPs) to quote for more opportunities.

Meanwhile Rate Benchmark facilitates informed procurement and pricing decisions and Freight Audit integrates audit capabilities into Transporeon’s Transportation Management Platform (TMP).

Price negotiations are opaque and manual in the growing freight spot market, the company explained, and freight forwarders, brokers and LSPs spend considerable time manually researching and building quotes.

To solve this challenge Transporeon now enables brokers and LSPs to prioritise incoming transport requests easily and automatically serve customers with instant, accurate pricing for truckload spot transports based on predicted market rates.

By fully automating the spot bidding process with Autonomous Quotation, brokers and LSPs can increase the volume of opportunities they quote for, which in turn, can lead to new business opportunities. Automating the process can also unlock cost-savings by minimising the manual work involved in the quotation process.

Rate Benchmark extends the capabilities of Transporeon’s existing Market Insights solution, which democratises truckload pricing by providing real-time insights into markets, lanes and their development.

Freight Audit will allow customers to audit shipments executed on Transporeon’s platform and combines a variety of specific capabilities, including cost allocation, online dispute management, invoice legal information audit, billing instructions, accruals and accounts payable.

The new tool does not require additional customer input as it uses existing platform data, such as rates and transport orders.

Commenting on the move during a launch event at Transporeon’s annual summit near Barcelona, chief executive Stephan Sieber said: “In today’s fast-paced world of transportation and logistics, adaptability is key for companies to survive and thrive. Digital technologies can significantly reduce cumbersome, manual processes. We have seen that when companies adopt more collaborative approaches, improved efficiency often follows. This is precisely what Transporeon’s platform enables.

“With our latest platform innovations, logistics teams can gain access to even more detailed market insights and codify tedious manual tasks into fully automated processes – not just within their own company, but between business partners.”

Meanwhile in a separate move, Transporeon said its new Freight Marketplace addresses the challenges of aligning capacity and assessing fair pricing with a tool designed to transform logistics procurement and redefine how companies buy, sell, negotiate and contract.

Its key benefits include a central location for deal-making, simplified negotiations, multi-dimensional negotiations that factor in sustainability, and enhanced visibility and transparency. Buyers benefit from pre-structured, standardised data that simplifies finding new partners through high-quality profiles.

Sellers gain access to a broader range of shippers and mini tenders, allowing them to win new business. Since every event is structured the same way, sellers can also evaluate opportunities more efficiently, meaning they no longer need to decipher shipper-specific jargon or endless Excel table names.

“Finding reliable partners, aligning capacity and securing fair agreements is a long-standing industry challenge,” explained Sieber. “That’s why we built Freight Marketplace to take freight procurement to the next level. At its core, our new solution is a one-stop shop for deal-making, empowering buyers and sellers alike to connect, negotiate and close new business. This is supported by advanced algorithms, full transparency and a focus on sustainability.”

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Q: What’s your strategy to cut emissions? And are many operators only paying lip service to zero carbon fleets?

A: We started 15 years ago so we’re ahead of the curve. But within the UK we realise we’re not going to be able to substitute 6,000 diesel vehicles for electric overnight. There’s not enough capacity, there’s not enough charging facilities and then there’s the cost.

So it’s a transition process using different fuels and different methodologies. HVO is a tool we’re using, because it allows us to use existing diesel vehicles and reduces your emissions by 80%. But we’re also investing in biofuels, both CNG and LNG vehicles. From a circularity point of view it’s a strong message. We’ve also recently bought our first electric trucks from Volvo.

Q: Are the government's net zero targets realistic?

A: A lot of things need to change. No operator can have trucks sat idle for hours on end. You need charging facilities. And ultimately hydrogen will come on board which will help. All of these things will happen but they won’t happen in isolation, it will be in conjunction, and that’s our approach. And likewise with warehousing we’ll do more with solar power and converting energy back to the grid to fuel our supply.

Q: Who’s going to pay for the transition? Roads minister Richard Holden has stressed the need for commercial partnerships, not government incentives. Where does that leave DHL?

A: There’s an opportunity for all parties to play a role. The government has an opportunity in creating an infrastructure which will future proof our country. Big commercial organisations have a role to play but it can’t all land on their shoulders.

In time I don’t believe it will be cost prohibitive for operators to switch to electric. Right now you have a scarcity of supply, but in time you won’t. And as with any economic model, supply and demand will match and costs will come down over a period of time. As things stand fuel is more expensive.

Q: And electric trucks are a lot more expensive…

A: Yes but we’re seeing that softening as well because more manufacturers are switching from traditional combustion to electric and others. We can’t expect to get there without some pain but hopefully if all parties work to the same objective we’ll get there a lot quicker. DHL may be the biggest player and we want to set the right example but we want to get there collectively.

Q: What do you make of HGV operators who say they’ll refresh their diesel fleets just before the 2035 phase-out date and run them for another generation? Will the government’s net zero targets have to be pushed back?

A: Each company will make their own commercial decisions.  I suspect that might be quite short sighted because at what point do you devalue or reduce the capital value of these diesel assets? They’re not going to be worth what they were last year in 10 years’ time. Demand will eventually slide. Whether it’s in five or 10 years’ time, demand will reduce and continue to reduce for these vehicles. What you‘ll see then is the cost will depreciate quicker, there’ll be less residual value for them. I wouldn’t want to be the last person standing with a whole fleet of diesel trucks.

Q: Evri fleet boss David Landy told us operators may be forced into buying trucks they don’t want in the next buying round. Do you agree?

A: The narrative has to change. If people look at this as being compelled, it’s the wrong argument. The argument has to be that this is the right thing to do. Our customers - the multinationals, the large retailers - expect us to work with them. The younger generations are also demanding this kind of behaviour. They won’t tolerate heavy carbon emissions to be associated with their products. We can’t wait for the world to line up neatly. Sometimes you have to be leaders. DHL and other large organisations have to lead the way, not the SMEs, they can’t afford to.

Q: What’s your best guess on how the transition for HGV fleets will ultimately pan out?

A: Truth is I don’t know and that’s why we’re taking a multi-faceted approach. We’re working with HVO and with LNG and CNG which have benefits and limitations. Electric also absolutely has a part to play. Technology will get better, hydrogen fuel cells will come in and who knows what else. And that’s exciting because it creates big opportunities.

Q: Is the government taking the right approach? Operators see no action plan or incentives…

A: It’s a real challenge and clearly we would like the government to be supporting us more in terms of infrastructure. It’s also about getting power to those charging facilities.

Q: You increased turnover to £3.1bn last year with pre-tax profit increasing by 86.5% to £63.3m. How satisfied are you with those figures?

A: In a difficult market we continue to perform strongly. We're seeing top line growth, we’re seeing profitable growth. We’re happy with the results and want continue to grow and deliver high end profitability. In a tough and testing market we can be proud of what we’ve achieved.

We’re fortunate that we play in a number of sectors. We’re well represented in retail, consumer, airline services and healthcare. The diversity of our portfolio has helped. We’ve seen uplift in the airline travel space since Covid which has been a big boost. We’ve also seen more availability of microchips so an uplift in motor manufacturing.

But on the flip side the retail sector is really struggling. Higher inflation in the low teens in grocery is impacting spend. We’re clearly a massive part of that because we move all the product into these stores.

Healthcare is always relatively recession proof and consistent, so that business is stable. Consumer business in parts has slowed down but what we do on the forecourt has uplifted. Shoppers are buying products more frequently but there’s less volume. High interest rates are impacting people’s disposable income. Mortgage payments are higher and rentals are increasing. E-commerce has also come off a lot from the highs of Covid. So that will continue to be a challenge as will grocery prices until we see inflation pressure brought to a more normalised level.

Q: Any room for optimism over the economy?

A: Yes, there’s light at the end of the tunnel. Inflation rates are coming down, the reserve bank is pausing interest rate increases. So hopefully we’re at the top of that and in due course we’ll see a softening. That will also speed up development in the market.

Q: Where do you see the market in a year’s time?

A: I’m optimistic by nature. Things are never as bad or as good as you think they are. We’ve got a strong economy, we’ve got a strong business and we’re still seeing very low levels of unemployment. That all bodes well for a strong bounce back. All the indicators seem to suggest a bounce back, with lower interest rates, lower inflation, lower levels of unemployment and fuel prices set to drop. Hopefully that will lead to greater consumer confidence and spend and translate into positive growth, which we’ve seen slow down over the last 12 months.

Q: What would be your advice to SMEs struggling on thin margins?

A: It isn’t that different to what we’re doing ourselves. Stay true to your core business. The focus has to be on your customers. Make sure you do what the customer wants you to do, not what you think the customer wants you to do. We look after them in tough times as well as good times. Whether you’re an SME or a large operation that doesn’t change.

This isn’t the time to be lavishly expanding on your costs and head counts unnecessarily. Do the things that make the most benefit to the business short term and medium term as well as to your customers. Then when an opportunity comes to open the purse strings that’s what we’ll do accordingly, and that’s what SMEs should be doing too.

Q: How much growth are you seeing in the business?

A: It’s within the budgeted forecast numbers but not growing organically. Fortunately, we have access to capital and we’re making long-term investments on automation, technology etc. So we’re certainly not parking up trucks or standing down shifts, we’re full steam ahead. But clearly our customers aren’t all growing at the same rate. In some cases we’re at 110% growth, especially travel and automotive, but elsewhere it’s a lot lower.

Q: What are the big growth areas?

A: Our transport business really excites me enormously. What we’re doing in terms of bio fuels and bio gases, HVO, electric... All of these ahead-of-the curve investments enable us to position ourselves at the forefront of the industry. We’re leading the way in setting the right tone on what firms should be doing from an environmental and sustainability point of view, but we’re also giving our customers the opportunity to partner with us, perhaps even ahead of their own requirements. Because it’s not a case of if but when companies will be compelled, at some level, to convert diesel to more environmentally friendly fuel. It will be a growth sector for us in due course.

I’m also excited about what we’re doing in the e-commerce space where we’ve invested a lot in technology. Most companies have some form of omni presence now, not just B2B but B2C and we have some great solutions.

Our consumer space also continues to grow. We’ve invested in high density solutions, carbon neutral buildings etc. Those sectors are ripe for growth, as is healthcare which is another massive growth opportunity. We’re doing clinical trials of high grade facilities for the distribution of pharmaceuticals and biologicals.

Q: Where else is DHL focusing its attention?

A: A lot of it revolves around data and technology and how to better manage risks that impact supply chains. We also give customers advice on where they can near-source their facilities or insure them to give them a better risk managment strategy.

We're also using automation, not because we want to substitute labour but to complement the labour we have so our staff are better utilised. Finally we are fixated on looking after our people. But we have to balance wages against what’s affordable and doesn't compromise our position in the market.

Q: Will multimodal become a bigger trend?

A: There’s a lot of arguments for rail but you have to be able to be responsive to customer requirements and have a reliable solution. It has got to be about more than just the envirmoment. There's cost, access, reliabilty and speed of service. There’s a space for rail movement but it won't be the panacea for all transport movements. We could see greater use of rail from dock to DC.

Q: Any M&A activity in the pipeline?

A: If we see something that will add value yes. It's not scale we're after but if there's a niche service that adds specific value that we don’t have and can develop we’d be interested. But it’s hard to identify something where somebody in the world isn’t doing it already.

Q: You've been in the UK for 18 months now. What’s the best part of your job?

A: I truly enjoy walking our sites and talking to our people. The more time I can spend away from my computer and engage with people the better. I’m inspired by them and take a lot from it.

Overall it’s been a great transition. l loved working in Australia. I was there for 17 years and I’m loving working in the UK as well, weather not withstanding. I want to drive positive change and growth and create opportunities for my colleagues. If I can do that what's not to love about my job?

For more stories tracking the industry journey to decarbonisation see our new Freight Carbon Zero website.

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