By Bruce Robbins

AS MANY as a quarter of the estimated 400 haulage jobs in Dundee will be at serious risk if high fuel prices continue into the future, it was claimed yesterday.

Escalating pump prices have already sounded the death knell for some UK hauliers, and many more are struggling to maintain viable profit margins.

Mark Ridgway, a director of the Dundee-based P. S. Ridgway group, one of the longest-established haulage companies in Tayside, said diesel had increased from 73p a litre, excluding VAT, at the start of last year to 99p last month.

Such hikes added almost £1000 to a lorry’s yearly operating costs, and not all of that increase is recoverable.

He said, “The worst thing is that this is unlikely to be the end of the story. The trade press is talking about fuel rising to £1.50 a litre by September. If that sort of thing were to continue there are bound to be casualties across the industry in Tayside.”

Over the last decade haulage companies in the region have already succumbed to the combined effects of new European legislation, increased competition and higher operating costs.

Mr Ridgway said his company’s contracts were protected to some degree through “escalator” clauses which allow a small increase in the contract price to take account of higher fuel rates.

However, not all customers are happy to agree to an escalator and some hauliers do not incorporate them, leaving them increasingly vulnerable to the rocketing cost of crude oil.

With fuel representing around a third of most firms’ operating costs, increases over the past year and those which the trade fears might be in the “pipeline” could impact on jobs.

Mr Ridgway said, “Operating costs are going up and we are faced with a raft of legislation in the haulage industry.

“We can see some companies going to the wall if it continues,” he said.

“I would say that, certainly in terms of fuel costs, this is the hardest period I can recall. With talk of a recession as well, it looks like being a difficult time all round.

“I’d estimate that a quarter of the jobs in Dundee could be at risk. Companies are trying to make efficiency gains but there is only so much you can do.”

Higher pump prices swell the Exchequer’s coffers through an increased fuel duty tax-take, and Mr Ridgway and many other members of his industry believe Chancellor Alistair Darling has plenty room for manoeuvre when it comes to ameliorating the worst effects of the hikes.

One way, he suggested, would be for Mr Darling to reduce fuel duty but increase VAT hauliers can claim back, albeit with a lag of around three months.

Although this would do little for ordinary motorists, Mr Ridgway said it would give the haulage industry some leeway and help consumers by limiting increases in goods such as food.

He added, “It’s not the Chancellor’s fault that world oil prices are up, but he could be doing more to help. After all, higher transport costs have a direct impact on prices in every sector of the economy.”