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22.6.20

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NEWS INSIDE

Cashflow, debts and late payments lead to collapse of Manchester firm 99220.008 MAN Trucks - New Truck Launch Banner 137x23_aw1.indd 1

Delayed Stobart Rail payment sinks Digway

By Chris Tindall 0940_MTA advert_celebrate_43mm wide01/04/2020 x 64mm high.indd 16:56 1

Thinking big

Pall-Ex will be biggest network after Fortec deal

Final tip

Covid-19 pushes PJ Brown into administration

Mirror, mirror

DVSA adds mirror questions to theory test

OPERATORS INSIDE Boughey Distribution ��p36 Clipper Logistics �� p3 Elis �� p3 EV Cargo Solutions �� p3 Expect Distribution ��p36 Fowler Welch ��p36 FreshLinc ��p38 Lenham Storage �� p4 Mann Haulage �� p4 PJ Brown (Construction) �� p4 Tarmac ��p38 Wincanton �� p3

18/02/2020 10:06

Manchester construction haulier Digway folded after Stobart Rail withheld a £317,000 payment, it has been revealed. Administrator Cowgill Holloway said Digway’s collapse was precipitated by Stobart Rail refusing to part with the money after its new management discovered it had overpaid by thousands of pounds. Business Recovery said a string of debts also caused cashflow problems at the haulier, which at its peak was making revenues of £3.06m. In late 2018 and early 2019, two debts caused by insolvencies put a £60,000 hole in its cashflow. Digway then tendered successfully for a minimum 12-month contract with Stobart Rail & Civils, after investing heavily in trucks and plant. Another £50,000 debt followed before a change in management at Stobart Rail

prompted a financial review and the revelation that Stobart had overpaid Digway. “As such, [Stobart] was withholding payment of invoices totalling £317,000,” said the administrator’s report. “To assist with short-term working capital, the company obtained a £250,000 loan.” Digway returned some financed machinery, but incurred a penalty of approximately £30,000. Subcontractors were told they would not be receiving any further work. Digway negotiated a £250,000 settlement with Stobart, but poor weather at the beginning of the year, coupled with reduced income and rising costs, led to the business running out of funds. Independent third-party CDL then became interested in acquiring the company. A company voluntary arrangement was rejected and the company entered administration on 11 May, with a

SPENDING SPREE: DPD has announced 6,000 new UK jobs and a major infrastructure investment following an unprecedented boom in online shopping during the Covid-19 pandemic. The firm plans to invest £200m this year to expand its next-day parcel service, including £100m on vehicles, £60m on 15 new regional depots (10 more than planned in 2020) and the remainder on technology. The jobs will include delivery and HGV drivers, warehouse staff, management and support staff, and mechanics. The vehicle investment is a separate and additional programme to its electric fleet and will mainly be in tractor and trailer units. However, DPD aims to have 700 EVs by September – 100 more than planned. The investment and recruitment will be in place before Black Friday as the firm prepares for what it predicts will be the busiest cyber weekend and Christmas period in its history.

pre-packaged sale to CDL taking place the following day for £20,000. All Digway staff were made redundant. n William Stobart has been appointed director of franchised B2B express freight service Speedy Freight. Eddie Stobart Logistics (ESL) has held a 50% stake in Puro Ventures, which trades as Speedy Freight, since 2017. The last available set of accounts for Puro Ventures, for the year to 30 November 2018, showed that it had increased turnover during the period by 42% to £26m and pre-tax profit had risen by almost 35% to £2.1m. Brian Corrway has been appointed as director to the firm. At the end of last year, Stobart backed a £75m bailout of ESL by private equity firm DBAY Advisors. The moved marked a victory for Stobart over former ESL group chief executive Andrew Tinkler, who made a rival £80m bid.

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Network will become largest in UK with 168 members when takeover of competitor is complete

Pall-Ex thinks big with Fortec deal By Carol Millett

Pall-Ex is set to buy Fortec in a move that will see a major consolidation of the pallet network sector. Fortec’s 70-plus members have been briefed on the deal, MT has learnt. The sale has been driven by the exit of Geodis, Fortec’s parent company, from the UK market. Once completed, the deal will create the largest pallet network in the UK with 168 members. Following the acquisition, Pall-Ex plans to operate Fortec as a separate legal entity, sources said. Pall-Ex will also retain Fortec’s staff and management team, led by MD Adrian Bradley. Fortec members have been offered the opportunity to become Pall-Ex shareholder members under the deal.

EV Cargo Solutions will drive growth Logistics and technology business EV Cargo has launched a division to integrate services across the group as part of a wider strategy to drive growth. Dubbed EV Cargo Solutions, the division has Jigsaw, the group’s 4PL, sitting at its heart. It will offer on-demand warehousing and consolidation, logistics and supply chain consultancy and integrated end-to-end supply chain solutions for key accounts. The division will be led by Jigsaw MD Andy Humpherson and will harness the group’s 9 million-plus sq ft of warehousing, 175 UK operating centres, 18 overseas operations and Palletforce’s 98 members and 116 depots, to deliver its services. Its on-demand warehousing will offer customers shortterm storage and handling solutions from the group’s network of ambient, chilled and bonded facilities across the UK and Europe. It will also provide urban last-mile distribution solutions via the company’s out-of-town consolidation and sorting centres.

22.6.20

Wincanton still on course despite Covid Wincanton has reported a strong set of financial results for the year to 31 March 2020, with revenue up 5% to £1.2bn and pre-tax profit up 7% to £52.9m. The increase was driven by a 26% rise in revenue from its retail grocery division that picked up a sizeable contract with Morrisons in June 2019, which has just been extended. Shares rose 10p to 195p on the announcement but are still off the peak of over £3 in February before the Covid-19 pandemic struck. Chief executive James Wroath, appointed in September last year, has completed a review of the business and has refocused direction and organisational structure to expand the group, but the current year got off to a bad start with revenue down 10% because of the lockdown. “The strategy we came up with

before Covid has not been changed by Covid. It was not a big change from what Wincanton was doing before, but focus is now on growth and better margin markets. The three we are highlighting are infrastructure, retail – especially e-commerce – and digital transport

marketplaces that connect the carrier and shipper,” he said. The company is already seeing signs of increased activity in its worst-affected divisions – construction and transport services, including containers – and May revenues were up 7% on April.

Palletways celebrates with Tradeteam Clipper moves in on Palletways London – part of the Palletways express freight system, which is owned by Imperial – has been appointed by drinks logistics business Tradeteam to distribute beers, ciders, wines, spirits and soft drinks across the UK and Ireland. Tradeteam provides local and national drinks delivery solutions for leading brands and blue-chip companies. Palletways will deliver between 45 and 60 pallets a day from its depot in Greenford, Middlesex. Asked why a drinks logistics specialist would need a pallet network to deliver product, a Palletways spokesman said: “Palletways will be supporting

Tradeteam with smaller consignments. The number isn’t too large so more than likely the consignments will be going to customers alongside larger orders.” Colin Sturgess, general manager at Palletways London, said: “This contract consolidates the great relationship we’ve built with Tradeteam and endorses our investment in sales and customer service.” n Downes Transport has signed up with United Pallet Network (UPN) after Pallet Track gave the company 12 months’ notice last year. The family firm, based in Amesbury, Wiltshire, will cover SP and several RG postcodes for UPN.

DHL Arcadia contract Clipper Logistics is to replace DHL Supply Chain as Arcadia’s store delivery partner. The contract was put out to tender after DHL declined to renew the deal with Arcadia, as part of the German group’s strategy to withdraw from low-margin, high-risk sectors such as retail. In a Stock Exchange announcement, Clipper Logistics said it will begin TUPE consultations once an appropriate process is agreed between Clipper and the incumbent. Once finalised, Clipper will make nearly 3,000 deliveries a week. The operation is expected to start from August 2020. MotorTransport 3

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Construction takes a hit as pandemic forces major players into administration with loss of jobs

Covid-19 tips haulier over By Carol Millett

Perkins of Parker Andrews and Andrew Andronikou of Quantuma. PJ Brown (Construction) was launched by Peter Brown in 1980. Brown is also the owner of PJ Brown (Civil Engineering), which continues to trade. The company operates from four depots based in Crawley, Uckfield and Horley and recently upgraded its fleet with 10 new tipper trucks.

n Staff and unsecured creditors of Grangemouth haulier Duncan Adams did not receive any money owed to them before the company was dissolved this month. In a final report from administrator Deloitte, it said there had been insufficient realisations to enable a distribution to these creditors after the company entered administration in March 2017. At the time, the move led to an immediate 132 job losses.

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FORS Gold member and tipper haulier PJ Brown (Construction) has gone into administration. The administration follows the closure of construction sites across the country in the wake of the Covid-19 pandemic, which has hit the sector’s supply chain hard. The Crawley-based firm, which has an O-licence for 79 vehicles, has appointed joint administrators Nicholas Cusack and David

Mann shuts after relocation and rescue bid fail 18-tonne and 26-tonne rigids and artics. FRP said it was initially appointed to arrange a company voluntary arrangement (CVA), which was approved by its creditors in August 2019 and provided for the restructuring of its business. But the liquidator said: “Despite a relocation of the business from Gateshead to shared premises on Drum Industrial Estate, Chesterle-Street, and efforts to boost effi-

ciency of operations, increased costs in its supply chain meant the terms of the CVA couldn’t be met.” n Bristol-based haulier Drive Force (UK) has entered administration. Incorporated in 1999, the company specialised in bulk car and HGV distribution and storage in the UK and Europe. It holds a standard international licence covering three operating centres; two in Exeter and one in Bristol, where it is authorised to run 25 HGVs.

Sharing networks could be the future A senior figure at one of the UK’s biggest logistics groups has claimed the Covid-19 pandemic will lead to more multi-user transport operations as companies look to cut costs. “You’re going to see more shared user delivery networks,” the source, who did not wish to be named, told MT. “Does House of Fraser need to go on a separate truck to Debenhams? Does Debenhams have to be on a separate truck to John Lewis? If they’re all going to the same town why don’t they share the trucks? “The battle isn’t on the truck, the battle is on the customer service in the shop. So I think we’ll see a growth in multi-user transport operations.” The source also claimed that the surge in online sales meant many consumers would request free parcel courier costs by using click and collect. 4 MotorTransport

HOMEWARD BOUND: Uncertainty surrounding Brexit has prompted Lenham Storage warehouse staff to return to their home countries, resulting in a recruitment challenge, according to the Kent firm. In a review of its business covering the trading period ending 31 August 2019, Lenham Storage Company also said it had strived to keep business as usual during the Covid-19 pandemic. Results for the period showed that turnover increased 5.9% to £39.1m, but pre-tax profit fell 8% to £1.1m. Lenham said it had seen a “hardening in the insurance market” regarding fleet and employment practices liability and it was braced for a challenging renewal period.

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All 39 jobs have been lost at family transport firm Mann Haulage in Chester-le-Street after the company was forced to close last month. Liquidators from FRP Advisory were appointed on 19 May after it lost its battle with financial difficulties that stemmed back two years. The haulier had operated out of the north-east since 2004 and held an O-licence for 12 trucks and 24 trailers. It ran a mixed fleet of 7.5-tonne,

Stop stressing drivers Driver licence checking service Licence Bureau has called for businesses to empower their drivers to make more safety-conscious decisions rather than heap more work-related stresses on them. It is urging businesses to entrust their drivers make the right commercial decisions based on health and safety and avoid the temptation to constantly check-up on them. The move underpins Licence Bureau’s recent ‘road health’ message that advises fleet managers to continue to enact on the new norms of social distancing and increased awareness regarding mental health, and encourage employees to ensure both are considerations when getting back behind the wheel for leisure or work. The call comes amid fears that increased economic challenges will place greater demands on drivers at the cost of operating compliance. It said there was evidence that demanding schedules and increasing driver distractions, including the expectation to field mobile phone calls while driving, was affecting driver risk. 22.6.20

THANK YOU FOR YOUR SUPERHUMAN EFFORT ON THE ROAD SuperhumanEffort.co.uk

To every driver and operator we want to say thank you, to support your unstoppable #SuperhumanEffort we’ve created an online hub with all of the critical information you need to navigate Covid-19. Drivers and operators can get the latest on a range of trucking related topics – from tips on staying hygienic on the road, to guidance on the latest legislation, to updates from MAN on how we’re supporting you. Find out more at SuperhumanEffort.co.uk

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14/05/2020 09:38

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Risk of death assessment prompts authority to update HGV theory test

DVSA adds mirrors to test By Chris Tindall

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The DVSA is to add questions to the HGV driver theory test about class VI mirrors after a coroner raised concerns about the risk of deaths being caused on the roads. In a letter from DVSA chief executive Gareth Llewellyn, he revealed he would also be recommending drivers take safe urban driving (SUD) and vulnerable road user (VRU) CPC courses. The move came after Norfolk coroner Jacqueline Lake filed a

report warning of a risk of deaths if no action was taken. She was responding to the death of 82-yearold pedestrian Dudley Howe in 2017, who walked in front of a stationary lorry in queuing traffic and was killed when the vehicle pulled forward. The driver was cleared of causing death by careless driving, but Norwich Crown Court was told he would have seen Howe if the mirrors on the lorry had been adjusted properly.

It’s back: Tip-ex/Tank-ex returns to Harrogate next year Tip-ex/Tank-ex, the UK’s only dedicated event for the tipper, bulk transport and tanker sectors, will make a welcome return to Harrogate on 3-5 June 2021. The free-to-attend event, which was postponed this year due to the Covid-19 pandemic, will take place in and around the Harrogate

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Convention Centre. Attendees will be able to visit hundreds of trade stands, where exhibitors will preview the latest vehicles, bodies and components. The event will feature a wide-

Leading speakers Interactive debates and polls ‘Two minute policy pitches’

ranging seminar programme, designed to keep operators up to date on the latest industry developments. Another highlight will be the Transport News Northern Rewards Breakfast, on of 4 June. To register, go to tip-ex.co.uk, or to exhibit, email emma.tyrer@ roadtransport.com.

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June 21st, 1920

Motor Transport was launched in 1905 as Motor Traction. We look at a story published 100 years ago: News and Comments. Speaking at the annual meeting of shareholders of the Austin Company, Sir Herbert Austin deprecated the suggestions made in some quarters that the “boom” in motor transport was over. Such statements were unfortunate and ignored the fact that no other means can possibly be applied, except mechanical traction, to rehabilitate commerce and restore civilisation to even its pre-war level in a reasonable time. Railway services could only be installed over a long period. Road locomotion and traction must supply their place, for the present at any rate.

Break-out sessions Exhibitions & networking Transport decarbonisation survey results

Speakers include: Sir John Armitt CBE, Chairman, National Infrastructure Commission; Caroline Russell AM, National Green Party Spokesperson on Local Transport; Melanie Lane, Chief Executive, Shell New Motion; Host: James Murray, Editor-in Chief, Business Green and others tbc. ‘Booking Now!’ Register free at: ‘www.lowcvp.org.uk/events/conference’ 6 MotorTransport

22.6.20

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News extra While firms involved in food distribution have stayed busy during the Covid-19 pandemic, many hauliers are desperate for the economy to restart. MT has asked a panel of operators to document their experiences as lockdown eases

To measure the impact of the Covid-19 lockdown on the transport and distribution industry, MT has put together a panel of operators across the UK to give regular feedback on their volume of work and vehicles laid up. We will check in regularly with the panel as the lockdown eases to assess how the industry is fighting back as the UK economy recovers from the expected recession. The good news is that volumes for most operators surveyed have stabilised after a turbulent couple of months, and the furlough scheme is still working as very few staff have had to be made redundant. With some exceptions, most lenders are also being sympathetic to requests to defer payments on trucks so very few trucks have been sold – though one operator commented that one reason for that is “no one is buying”.

Cullimore Group, Moreton Cullimore, MD

Coverage: UK, but predominantly the Midlands and south-west. Main business sectors: Transport and general haulage, aggregate supply and ready-mixed concrete. Trucks on fleet Laid up (%) Drivers employed Furloughed (%)

18 May 60 90 50 88

2 June 60 85 50 85

Have you disposed of any trucks since 23 March? No, no one’s buying. How do you fund the acquisition of trucks? Asset finance from bank. Have you had discussions with your lenders or leasing company about deferring payments? Yes, we have been given a three-month holiday. Have you had to make any drivers or other staff redundant since 23 March? No. 10 MotorTransport

Taking the industry’s temperature Owens Group Doug Jeffery, group general manager

Coverage: UK mainland. Main business sectors: FMCG, steel, retail, express and home delivery, construction and automotive. Between 18 May and 1 June we have seen a further 8% increase in volumes. 18 May 2 June Trucks on fleet 300 340 Laid up (%) 16 6 Drivers employed 656 656 Furloughed (%) 10% 5% Have you disposed of any trucks since 23 March? Yes – end of contract and not renewed due to reduction in volumes. How do you fund the acquisition of trucks eg cash, bank loan, leasing, contract hire, hire purchase etc? All of the above are used. Have you had discussions with your lenders or leasing company about deferring payments? Yes. They have been very positive, with payment holidays being agreed by some. Have you had to make any drivers or other staff redundant since 23 March? No, not at the moment. But this may be required going forward.

Clipper Logistics Mick Doe, transport operations director

Coverage: UK from 13 transport operations with a higher presence in the ‘golden triangle’ and South East of England. Main business sectors: Retail fashion and highvalue goods including pre-retail, e-commerce, storage, store replenishment transport solutions and returns management; technical services for brown goods. We have seen no change in volumes since mid May. Trucks on fleet Laid up (%) Drivers employed Furloughed (%)

18 May 450 22 450 20

2 June 450 22 450 20

Have you disposed of any trucks since 23 March? No. How do you fund the acquisition of trucks? We lease vehicles.

Have you had discussions with your lenders or leasing company about deferring payments? Yes, but these have proved extremely difficult and they are still ongoing. Have you had to make any drivers or other staff redundant since 23 March? No.

Roger Warnes Transport Ian Barclay, operations director

Coverage: UK mainland. Main business sectors: Bulk agricultural and construction sectors. Business activity is trending upwards but unpredictably. Daily demand fluctuations are greater than ever before. People “getting back to the office” is actually helping us with more complete and reliable customer contact. Trucks on fleet Laid up (%) Drivers employed Furloughed (%)

18 May 108 44 114 20

2 June 108 18.5 111 18

Have you disposed of any trucks since 23 March? No. How do you fund the acquisition of trucks? Cash, with small interest-free HP arrangement. Have you had discussions with your lenders or leasing company about deferring payments? One leased vehicle supplied as a “seed” by Truck East Scania has been put on SORN and a threemonth payment holiday. Most suppliers have been positive, supportive and very flexible. Have you had to make any drivers or other staff redundant since 23 March? No.

Caledonian Logistics Derek Mitchell, MD

Coverage: Four DCs cover half of Scotland including islands. Distance division covers mainland UK. Main business sectors: Pallet distribution, general goods, food products and storage services. Between May 18 and June 1 full load work is now only down about 5%. Pallet distribution was down about 30% but is now at approximately 20%. 22.6.20

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Trucks on fleet Laid up (%) Drivers employed Furloughed (%)

18 May 74 10 98 22

2 June 74 10 98 20

Have you disposed of any trucks since 23 March? No. How do you fund the acquisition of trucks? Contract hire and HP. Have you had discussions with your lenders or leasing company about deferring payments? Yes and the majority have given payment holidays, though some have wanted extra admin charges. Have you had to make any drivers or other staff redundant since 23 March? No.

Stagefreight Ian Uttley, director

Coverage: UK mainland. Main business sectors: Live events, theatre and music tours, conferences and exhibitions, and general haulage. We have started quoting on event work again, but 96% of it is for 2021 as the events industry is still in lockdown. However, our general haulage movements have risen by 26%. We are now using 19 drivers with 19 trucks. Trucks on fleet Laid up (%) Drivers employed Furloughed (%)

18 May 30 50 26 50

2 June 30 45 26 45

Have you disposed of any trucks since 23 March? No. How do you fund the acquisition of trucks? HP or outright purchase. Have you had discussions with your lenders or leasing company about deferring payments? Yes. They were very helpful and have all given a payment break without hesitation. Have you had to make any drivers or other staff redundant since 23 March? No.

Freightlink Europe Freight Train/ Freight People Lesley Oâ&#x20AC;&#x2122;Brien, partner

Coverage: UK national. Main business sectors: General haulage transport operator predominantly serving the import and export community. 18 May 2 June Trucks on fleet 24 24 Laid up (%) 33 20 One subcontractor working for us on 23 May and two subcontractors on 2 June Drivers employed 22 22 Furloughed (%) 33 20 Have you disposed of any trucks since 23 March? No but five vehicles came to the end of their contract hire. They are on standby awaiting return on a new contract â&#x20AC;&#x201C; two returned on 1 June. How do you fund the acquisition of trucks? Hire purchase and contract hire. 22.6.20

Have you had discussions with your lenders or leasing company about deferring payments? Most companies are offering three months, but Lombards are actually offering six months. We have arranged payment holidays with Paccar on the above contract hire. Although the contract hire came to an end in order for it to be reinstated it had to be considered as a continuation of agreement. We have also arranged a payment holiday with Iveco. Regretfully Mercedes is not very customer friendly or proactive unless trying to sell a vehicle. It is the suppliers who work with us now who will undoubtedly be our future partners. Have you had to make any drivers or other staff redundant since 23 March? No.

Miniclipper Logistics Jayne Masters, sales director

Coverage: UK national. Main business sectors: Pallet networks, warehousing and Hazchem. Volumes increased by 7% between 18 May and 1 June. Trucks on fleet Laid up (%) Drivers employed Furloughed (%)

18 May 27 0 36 0

2 June 26 7.7 36 22.2

Have you disposed of any trucks since 23 March? Yes, one which was out of contract. How do you fund the acquisition of trucks? Mixture of lease and HP. Have you had discussions with your lenders or leasing company about deferring payments? We had a precautionary call to see what the response would be if the need arose with the vehicle lease company. The response was very positive and were offered a payment holiday on a monthly basis Have you had to make any drivers or other staff redundant since March 23? No.

Turners Group, Paul Day, MD

Coverage: UK national. Main business sectors: Temperature controlled, containers, tankers and general haulage for transport and temperature controlled warehousing and packing services. Between May 18 and June 1 there was generally a continued gradual improvement in all sectors bar aviation, which remains virtually closed down. 18 May 2 June Trucks on fleet 1,872 1,925 Laid up (%) 14.6 12.2 1,997 2,125 Drivers employed Furloughed (%) 20 15 Have you disposed of any trucks since 23 March? Very few. How do you fund the acquisition of trucks? Cash. Have you had discussions with your lenders or leasing company about deferring payments? No discussions required. Have you had to make any drivers or other staff redundant since 23 March? Yes, a small proportion, but we will consider this dependent on the recovery of each sector.

LOOKING FORWARD: (from top) Moreton Cullimore; Derk Mitchell; Jayne Masters MotorTransport 11

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APPG calls for action after impact of Covid-19

Time to put logistics top of agenda Road haulage and logistics is an essential but forgotten industry that government must do more to support if it is to address its skills shortages and help drive the postCovid-19 economic recovery, according to Sir Mike Penning MP, chair of the All-Party Parliamentary Group (APPG) on road freight and logistics. But a separate survey of training providers carried out in May by Skills for Logistics found that the training industry’s ability to resume HGV driver training after the lockdown may be severely restricted as many companies are in serious financial difficulties. When Penning set up the APPG in 2018 one of his key goals was to get government to listen to an industry that often feels ignored and unrecognised, and just before the coronavirus pandemic struck the group held a major inquiry

into what needs to be done to raise its profile both in Parliament and among the wider public. The inquiry found 64% of logistics firms have severe skills shortages and that the industry needs an extra 59,000 drivers. Since this report was compiled, an MT poll of operators found that most expect the driver shortage will ease after the lockdown as the industry consolidates, the economy stagnates and the trend towards online shopping continues.

Action, action

In his report on the results of the inquiry, ‘Keeping Britain moving’, senior Conservative backbencher and former transport minister Penning pulled no punches and set out a long list of actions he wants to see from government – and industry – to take advantage of the higher profile of the road

RECOMMENDATIONS FOR GOVERNMENT n The DfT must support the industry to make a career in the industry more attractive to school leavers, by promoting the value and importance of the industry n The DfT should overhaul the Driver CPC and empower and motivate drivers through improved training and recognition and including modules on mental and physical health n Review and reform the motorway and road network facilities available to drivers is essential n The Department for Education must urgently overhaul the Apprenticeship Levy, which fails to meet the needs of the industry n The Ministry of Defence should work better with industry to ensure that military leavers receive better signposting and support in their transition into careers within freight and logistics, many of whom hold HGV licences n HGV drivers and skilled warehouse operatives should be added to the shortage occupation list to ensure that the sector can recruit and retain workers to meet the demand

RECOMMENDATIONS FOR INDUSTRY

n Do more to promote respect for drivers n Continue to push for more high-quality parking facilities on the road network and better working environments at terminals n Improve the training it offers and do more around career progression for drivers 12 MotorTransport

freight transport industry during pandemic to recruit and train more homegrown drivers. “It is widely accepted that there is no single cause for the shortage,” he wrote. “Instead, it arises from a combination of factors including the Apprenticeship Levy not working effectively, poor mental and physical health outcomes for drivers, poor roadside facilities and the attractiveness of other careers. “By understanding the experiences of industry have we been able to put forward exactly what steps must be taken to ensure that drivers can continue to meet current and future demand. “I am pleased secretary of state for transport Grant Shapps MP has taken these issues seriously since his appointment last summer. As we look to measures to help the industry and our economy recover from the impacts of Covid-19 it is essential that we work together to address the things that can hold back the industry from playing its full role in our economic recovery. Therefore, this report should be used as a roadmap for policymakers and industry leaders that are committed to reversing the driver shortage.” Penning concluded: “It is essential that the government take urgent action and work more closely with the industry to solve the skills shortage and to allow this vital industry to continue to play its vital role in supporting the UK economy as we look to recover from the impacts of Covid-19.” However, a survey of 61 training providers by Skills for Logistics found that almost a fifth of companies were concerned that the lockdown would reduce their ability to resume training at their previous capacity with a further 5% saying the pandemic could even threaten their survival. In response to Covid-19, the DVSA suspended nearly all driving tests including LGVs from 19

March until at least 22 June. This date is subject to change and when tests resume it is proposed that DVSA examiners will reduce their workload from four to three LGV tests per day. In March all LGV training ceased, training centres were closed and staff laid off or furloughed. Some training providers have already entered administration and others are suffering financial hardship. Before Covid19 the DVSA conducted on average 1,500 LGV tests a week so, at an average pass rate of 60%, approximately 1,000 newly qualified drivers a week are being lost in the shutdown. This is on top of the existing shortage of 59,000 drivers and a potential 20,000 more that may be not working for reasons connected with Covid-19.

Where now?

The 61 training providers surveyed trained more than 1,000 drivers a week to test standard in 76 centres with a mix of 540 employed, parttime and associate instructors and a fleet of 580 training vehicles. The current position of those training providers is: n 100% of LGV training has ceased; n 96% of all LGV instructors have been furloughed; n 4% of LGV instructors have been made redundant. Providers were asked about their degree of confidence that their LGV training business can resume operations and meet the likely increase in demand when DVSA testing resumes. Three quarters (77%) were moderately to very confident about the outlook and will be ready to return to prepandemic volumes or greater. Three providers were doubtful about their chances of survival with 18% suggesting that their business will be adversely affected in a way that would reduce their capacity to deliver. 22.6.20

Focus: warehousing

motortransport.co.uk

The rush for warehouse capacity during the pandemic shows no sign of easing off anytime soon

Space: the final frontier The Covid-19 crisis gave the UK warehousing market a huge jolt. While some companies were suddenly forced to find short-term space to meet unexpected demand, others had to deal with a build-up of unsold stock. Now, however, leading property agents say that the market has settled down with occupiers and developers looking more strategically at their needs and trying to adapt to longer term changes. Richard Evans, head of UK industrial and logistics at Cushman & Wakefield, said there have been several waves of demand since the crisis began. “The first three or four weeks were dominated by supermarkets looking for more space to cope with increased volumes and reorganising their supply chains to keep shelves stocked. There were also a number of government-led enquiries,” he said. “Then you got companies trying to stockpile goods that had come into the ports and needed to be put away into warehouses to avoid demurrage charges. Now we are seeing a return of strategic deals that had been put on ice.”

Major players

The initial activity included Tesco reoccupying two buildings, a 620,000sq ft warehouse in Milton Keynes and a 300,000sq ft unit in Middleton, Greater Manchester. Meanwhile Asda took 315,000sq ft at Bardon in Derbyshire on a 12-month lease. Others have used spare space

14 MotorTransport

in their 3PLs’ networks or asked them to take on extra warehouses. Clipper Logistics, for example, created additional services for several retailers including Tesco, Asda and Morrisons. It has also provided facilities for the NHS, including distribution of PPE to hospitals, GP surgeries and care providers. The company took on a 240,000sq ft facility in Daventry on a 12-month lease as part of its activities As well as these food and healthcare requirements, products arriving in the UK from overseas have created capacity issues for those involved in clothing and other nonfood products. Although a number of companies have looked at what is on the market – including furniture retailer DFS which took 150,000sq ft in Bolton on a 12-month lease – this has not led to significant sales and lettings activity. Savills director Toby Green said: “There has been a lot of press about stock coming into the UK but it hasn’t brought many new transactions.” The majority of requirements have instead been soaked up by existing 3PL networks. Marks & Spencer, for example, is using its 3PLs to ‘hibernate’ £200m worth of products until next year. Next is using a mixture of 3PL facilities and a policy of holding some stock in source countries to carry forward £330m worth of basic products such as t-shirts and chinos. Charles Binks, head of industrial and logistics at Knight Frank, believes that one reason for this

approach is that few landlords are willing to agree short-term deals. Many will only do so if there is a rolling break clause that ensures a building can be vacated quickly if necessary. “It means they can still do a deal if a longer-term occupier comes along,” he said.

Online opportunity

Agents said that many medium and longer requirements were put on hold as the crisis developed but are now being pushed forward. Cushman & Wakefield, which measures buildings over 50,000sq ft, said that take-up dropped to 5.5 million sq ft in Q1, which is 32% below the 10-year average. However, the first seven weeks of Q2 saw the same amount of space sold or let with a further 12.6 million sq ft under offer. Many believe that warehousing demand is being stimulated by a long-term switch to online shopping, which was accelerated by consumers having no other option during the lockdown. According to the ONS, the proportion spent online soared to the highest on record in April 2020 at 30.7%, up from 19.1% reported in April 2019. Online groceries, particularly, have increased spectacularly. Tesco claimed that it became the first supermarket to fulfil 1 million home delivery orders in a week at the end of April and said it will eventually fulfil 1.2 million orders – twice the pre-Covid level.

Even if only a proportion of consumers switch permanently to online shopping, it will stimulate demand. This could put pressure on warehousing supply. Savills estimates that there is only 5 million sq ft of speculative development of buildings above 100,000sq ft in the pipeline for 2020 and beyond, compared with the 8.8 million sq ft that was delivered in 2019. Such space will be needed as occupiers address the longer term. Marks & Spencer has signed a 10-year lease on a 360,000sq ft unit, MK360, in Milton Keynes. Similarly PPE manufacturer and wholesaler Beeswift has taken the 120,000sq ft Hub 120 in Birmingham, on a 16-year lease. Other recent deals include the letting of an 186,000sq ft building at Magna Park Lutterworth by Gazeley to supply chain management firm Bleckmann on a 15-year lease. Tritax has agreed a 15-year lease with Great Bear for a 335,000sq ft warehouse at Central M40 in Banbury, while Pets At Home has taken 141,000sq ft from landlord LondonMetric in Stoke. Cushman & Wakefield’s Richard Evans believes that further stimulation of the market could come as occupiers reassess how much stock they should keep and where – especially as Brexit nears. “It’s all about looking at where the product is made and how quickly they can get hold of it,” he said. 22.6.20

From 26th October 2020, ALL goods vehicles over 12 tonnes will require a permit to enter London.

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Viewpoint

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Get a grip of driver shortage I

f the road transport industry learns one lesson from Covid-19 let’s hope it is that we need to sort out the shambles that is LGV driver training. The suspension of driver testing by the DVSA since lockdown and the fact that it still cannot give a date for resumption of testing means that every Steve Hobson week the industry is effectively losing 1,000 Editor new drivers who would have acquired their Motor licences and entered the industry. Transport While there is a general feeling that the driver shortage – put at between 50,000 and 60,000 before Covid-19 – will permanently shrink even as lockdown eases, the industry cannot afford this blockage in the pipeline of new drivers. There is a huge risk that the combination of Brexit and the rollout of IR35 to the industry could see the driver shortage spiral upwards next year. So once testing resumes we need a plan to recruit, train and retain good drivers. The driver training industry is fragmented, largely composed of small regional training providers, and the quality of training varies enormously. At one end

there are excellent firms with dedicated, professional trainers struggling to make ends meet while delivering top-quality training in competition with the cowboys who populate the other end of the scale. The DVSA has turned its back on the LGV training sector, resulting in the ridiculous situation where there are two voluntary registers for the 600 or so instructors, none of whom require a formal qualification or assessment of their capability. How can a new entrant to the industry know if their hard-earned money is being well spent when there is no formal recognition of a qualified instructor or training school? Operators need to get a grip of the situation and invest in a proper industrywide training programme using top-quality instructors for licence acquisition, followed up by a structured introduction to the industry. Sounds a bit like an LGV driving apprenticeship? Shame the one we have is – with a handful of honourable exceptions – failing the industry so miserably.

Prepare for new immigration rules A

Aldijana Hoad Director OTB Legal

s lockdown eases, companies in the logistic sector are being reminded that the UK is still on track to leave the EU at the end of the year and to ensure plans are in place. Reports suggest approximately 13% of those working in the logistic sector are from the EU and companies should prepare for the new rules being introduced in January 2021. This is probably the last thing many business owners are thinking about right now and there were suggestions that the new immigration rules would be delayed because of the lockdown. However, UK Visa and Immigration (UKVI) centres are re-opening and latest government guidance states they are pushing forward with the new rules. One change to the law means that to employ EU nationals currently not living in the UK after 1 January 2021 a business will need a sponsor licence to take on staff with A-level or equivalent standard skills. This is compared with the degree level required previously when filling a vacancy. This licence grants a company permission from the Home Office to employ overseas staff – previously something only needed for non-EU workers. It is important for companies to apply for

16 MotorTransport

a sponsor licence now if they want to take on EU nationals next year. It is also worth noting that EU nationals entering the UK after 31 December 2020 will not get any special status to work as HGV drivers or warehouse staff. The latest guidance states that the process will take approximately eight weeks, so companies should consider what the impact would be on their workforce and subsequent delivery of goods and services if there was a delay in getting a sponsor licence granted. For companies employing EU nationals living in the UK, those individuals have until 30 June 2021 to apply to the Home Office for settled or pre-settled status under the EU Settlement Scheme. If they do not apply before this date, they would lose their right to live and work here and you would be employing them illegally. The consequence of employing someone illegally can be very serious and include a penalty of up to £20,000 per illegal worker, criminal sanctions, including up to five years imprisonment and/or an unlimited fine.

The newspaper for transport operators

To contact us: Tel: 020 8912 +4 digits or email: name.surname@roadtransport.com Editor Steve Hobson 2161 Head of content Tim Wallace 2158 Events and projects editor Hayley Pink 2165 Group production editor Clare Goldie 2174 Supplements production editor Joanne Betts 2173 Key account manager Andrew Smith 07771 885874 Display telesales Barnaby Goodman-Smith 2128 Event sales Tim George 0755 7677758 Classified and recruitment advertising rtmclassified@roadtransport.com Sales director Emma Tyrer 07900 691137 Divisional director Vic Bunby 2121 Head of marketing Jane Casling 2133 MT Awards Katy Matthews 2152 Managing director Andy Salter 2171 Editorial office Road Transport Media, First Floor, Chancery House, St Nicholas Way, Sutton, Surrey SM1 1JB 020 8912 2170 Free copies MT is available free to specified licensed operators under the publisher’s terms of control. For details, email mtsccqueries@roadtransport.com, or call 01772 426705 Subscriptions Email:customercare@dvvsubs.com Quadrant Subscription Services, Rockwood House, Perrymount Road, Haywards Heath, West Sussex RH16 3DH Rates UK £135/year. Europe £163/year. RoW £163/year. Cheques made payable to Motor Transport. Apply online at mtssubs.com Registered at the Post Office as a newspaper Published by DVV Media International Ltd © 2020 DVV Media International Ltd ISSN 0027-206 X

Got something to say?

If you would like to contribute to MT’s Viewpoint, email steve.hobson@roadtransport.com 22.6.20

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Green transport

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Burning ambition How is the UK really tackling the switch to new zero emissions in haulage? Steve Hobson speaks to Andy Eastlake, MD at the Low Vehicle Carbon Partnership, for an update on progress

f one thing is certain as the UK heads to net zero carbon emissions by 2050 it is that no one low carbon technology has emerged to provide the answer to tackling heavy, long distance freight transport in the near term. Over the next 30 years there is likely to be a mix of biofuel, natural gas, battery electric, hydrogen fuel cell and maybe even electric roads to gradually replace conventional diesel engines – which will also become more fuel efficient as the OEMs continue to invest in the technology. The Low Carbon Vehicle Partnership (LowCVP) keeps a watching brief, led by its MD Andy Eastlake (left) . And while the LowCVP is not about to start picking winners in the race to come up with a viable low-carbon truck, Eastlake says there are now some pointers to the future. “I don’t think it’s clear what the right solution is in long-haul, zero-emission trucking,” he says. “It’s highly likely we’ll be driving them with an electric motor. That means we will have to have some batteries and/or supercapacitors to recover all of the regenerated braking energy. “That architecture is emerging fairly clearly, but how you get the energy to do long-haul distances is a really interesting question. Is that a hydrogen fuel cell with hydrogen tanks? Is it an engine with either hydrogen combustion or even diesel combustion in the short term? Is it gas, be that bio or fossil, in the medium term? “Is it a big battery? Unless there’s a breakthrough in batteries, I can’t see us trying to drive long distances. With batteries, there’s a lot of material and embedded energy in their lifecycle, so we have to question is that the right way of doing long haul? I’m not yet convinced.”

20 MotorTransport

What is clear is that there will have to be transitional drivetrains that make best use of available technology, rather than waiting for the perfect solution. “Personally, I’m a great believer in the near term of things like range extenders,” says Eastlake. “Get a battery of moderate size to do the bulk of your short journeys on electric in urban areas. Then, if you are doing a long distance, you haven’t got anxiety about range. “Interestingly, I was recently having a conversation with a government minister and I don’t think that the public – and we’re talking about cars now – has range anxiety any longer. It’s now charge anxiety. It’s not ‘can I get there?’, it’s ‘can I charge when I get there? Is the charger going to be working or is it going to be blocked?’ “In the truck sector, there are still a lot of options on the table. Hydrogen, electric highways, battery in some applications, and I genuinely don’t rule out long-term internal combustion. We are now getting to the point where combustion engines are very clean in terms of air quality. Emissions are barely measurable now, be that particulates or NOx. “If we can put a low-carbon fuel in them, on a net carbon emissions basis, it starts to make quite a lot of sense and the infrastructure implications are a lot easier. There may be a long-term role for combustion of very low carbon renewable fuels.”

Competition time

One potential problem with biofuels – be they diesel or gas – is that there will be stiff competition for the limited quantities available from other even harder to decarbonise sectors like aviation and heating. “Certainly, in the near term, we’ve got to try to decarbonise the combustion engine as much as we can,” says Eastlake. “But we’re not going to have enough to do what we need to do to decarbonise, whether you put it into the grid or into trucks or whatever. At the moment, I don’t think there’s enough thought about how valuable energy is. We’re so used to filling up our car or truck with diesel that we don’t really think about how much energy is there and how valuable that is. “When we to get things like bioresources, which are potentially very valuable in a decarbonising world, hopefully we’ll start to think seriously about energy and its value and therefore put it into the place where it has the most impact. “A van is a great example. Electrifying urban driving is really powerful. You can displace probably twice as much petrol or diesel for each kWh of battery power in 22.6.20

motortransport.co.uk

an urban environment as you can on a motorway. If we’re trying to displace diesel, the most effective place to electrify is an urban operation. Running up and down motorways on a battery is certainly not as efficient. “It’s the same with gas. The right spot for gas, fossil or bio, is actually in long-haul trucking. The data that’s coming out of the LEFT trial clearly shows that the CO2 benefits and maximum efficiency are in that long-haul heavy operation. Using gas in city centres isn’t the best place. It doesn’t displace as much diesel there as it does in long-haul. Should we think about incentivising gas into that operation and incentivising electricity into urban operations and starting to pick winners, logical engineering winners, rather than political winners? I think that’s probably a good way of going about it.” As David Cebon argued recently (MT June 8) making hydrogen is currently a very inefficient use of renewable electricity. “This is one of the arguments against hydrogen,” agrees Eastlake. “If we use renewable electricity to make hydrogen by electrolysing water, compress it, transport it, put it into a truck, run it through a fuel cell to make electricity to run a motor, we’ve effectively lost half of the electricity that we would have had if we put that straight into a battery. We need to think about the efficient use of renewable electricity and the pathways we need. “What’s our objective? We’ve got to have clean air and low carbon. We’ve got to keep to that principle of efficiency throughout. There’s no point in us wasting half of the energy and then berating the driver for not driving efficiently. Let’s try and get an efficient system.” While the government does not want to start backing technology winners, preferring to set targets and let the market decide how to achieve them, vehicle manufacturers are warning that, without better support for recharging infrastructure, the take up of low-carbon vehicles will be held back. The 2050 deadline is only 30 years away so moving from a 99% fossil-fueled truck fleet to zero emissions is going to require some big changes – and fast. “The government knows we’ve got to be thinking about what is the right solution for the heavy truck industry,” says Eastlake. “We have to be making decisions during this decade. We haven’t got long to do more trials. We have got some time to start thinking about what questions do we still need answers to, and how do we get those answers before the second half of this decade. “We need a decision on the infrastructure system that we’re going to have to put in place. Is that going to be a 22.6.20

whole lot of hydrogen stations all over the country with a commensurate transfer of the gas grid to hydrogen? Do we make hydrogen for transport by road and leave the grid with natural gas? If we’re going to put catenaries up over all our motorways, that’s not a small task and we’re going to have to think about it quite rapidly. “One of the things we’re talking about is what trials do we now need to do on trucks over here in the UK. I believe we don’t need to trial gas trucks any more. We know how they work. We know they’re economic, given where the fuel price is. We know you can buy them as the OEMs are making them at production scale. With hydrogen, there are still some technical questions. We haven’t yet got a hydrogen fuel cell truck available in the UK. We haven’t yet got a big battery tractor unit here in the UK. We’re looking over the fence to Nikola, Tesla and people like that but those are still a little way off.”

Getting the sums right

The government has committed to retaining the 50% duty discount on natural gas over diesel until 2032, and as well as being economically viable for many long haul operators, natural gas delivers CO2 reductions of up to 20% compared with diesel, so gas is clearly a worthwhile step on the road to net zero. But with Hyundai hydrogen trucks on trial in Switzerland and Iveco teaming up with Nikola to develop battery and fuel cell trucks many operators worry that there is no point investing in gas as it will be obsolete within a decade. But Eastlake argues: “Personally I think hydrogen’s still got quite a few questions to answer. It’s a lot more effort to make hydrogen than to create gas. We can get more renewable biogas into the mix. There’s still more capacity there. “The gas supply companies are putting in stations, and they’re not doing that for one or two years. They’re doing that because there is a clear role. Whether we’ll maintain the gas duty differential, or whether fuel duty will still exist in its current form in 2032, is another question entirely. “I would love to see a differential duty for renewable gas versus fossil gas. At the moment, whether you run your truck on fossil gas or 100% biomethane, you’re paying the same amount. That’s wrong, in my view. We’ve got a commitment from some big, blue-chip companies such as John Lewis and UPS to used 100% biomethane for their heavy vehicles. The operators, the guys at the coalface, are saying this is a good solution for this next generation of trucks. ➜ 22 MotorTransport 21

Green transport

motortransport.co.uk

“I am quite reserved about hydrogen at the moment and we probably need another four or five years trialing hydrogen trucks. We might be shaping the market in 2025 to say ‘here’s a handful of hydrogen trucks and this is how they work. These are the problems getting hydrogen to them’. You wouldn’t be talking about any mass uptake of anything like that until the 2030s maybe. “The same goes with a long-haul electric catenary system. Yes, there are trials in Sweden and Germany but there are still a lot of questions. We haven’t gone electric on all our railways yet – if we can’t get that sorted, would you start on motorways?”

The generation game

While there is an appetite among many urban delivery operators to switch to battery electric vehicles, the lack of grid capacity is often a barrier. “The Electric Vehicle Energy Taskforce was looking at exactly those issues and how do we grapple with them,” says Eastlake. “The big piece of the jigsaw is how to charge them overnight smartly. What we need to do is to join up the thinking about those vans being charged during the night. Businesses need electricity during the day. Houses need it in peak time in the early evening. There are enough electrons. But they’re not necessarily in the right place at the right time. “At the UPS Camden depot they do smart things with energy storage. DPD is saying if we’ve got a battery on a van, and that van comes back to the depot at 5pm then we’re prepared to sell some of that energy back to the grid at peak price and recharge it overnight. You can then start to do something interesting to change the economics and actually help the energy system. “The point of that programme was to join up the people making and running vehicles, the people making and selling energy and the people delivering the interfaces, both wires and chargers. Between us, there’s quite an elegant solution. We can minimise the amount of investment needed to get the system we need. If we work apart, the investment into the grid is going to be billions of pounds.” One way every truck operator is already cutting carbon emissions is through the Renewable Transport Fuels Obligation, which currently requires that 9.7% of fuel for road vehicles is derived from renewable sources (B7). The RTFO has been complicated by the introduction of 22 MotorTransport

“double counting” of RTFO certificates where fuel is derived from waste products rather than crops and as a result the actual percentage was only around 4% when the figures were last reported. So should the government be upping the theoretical renewable blend to 10% (B10)?

Guiding force

“That is exactly the message we’re taking to government,” says Eastlake. “The RTFO is a minimum. There are some really good renewable diesels out there. They don’t get the crack of the whip that maybe biomethane does. “We are about to publish a renewable fuels guide and we’ve got to focus on increasing the amount of high-blend renewables in the heavy market. We’re probably at about 3% at the moment but I think we might have a chance to challenge going up to B7 in that sector. “To deliver the RTFO, my personal view is that we need to have an increase in the high-blend renewable fuels used in heavy trucks. Having said that, it’s not just about the volume of renewables. It’s about how renewable is it? Let’s not just do it all with double counting waste. “Our approach is to maximise the greenhouse gas savings whilst meeting or exceeding the RTFO targets. It was great to see the RTFO extend up to 2032. That sends a real message the market. We want renewable fuels in our transport sector. We acknowledge we’re going to be using these fuels out into 2030s, so let’s minimise the impact of whatever we’re burning.” While there is a debate about the environmental credentials of hydrogen, one thing that is not in dispute is that – despite attracting no fuel duty at all – it is still very expensive. The trials of hydrogen buses and trucks taking place around Europe all rely on government and EU subsidies and without those the total cost of ownership of hydrogen vehicles is for now prohibitive. “Hydrogen doesn’t make economic sense at the moment,” says Eastlake. “These are all funded projects and it’s still got a long way to go. “Gas doesn’t actually need funding any more. The economics of buying a gas truck and running it for an operator stack up. Even without any duty, hydrogen is still not quite there yet. “Gas has moved on. The numbers stack up, and people are putting the stations in commercially, without government funding. That says it all.” n 22.6.20

Marketplace news

Marketplace OK Trucks gears up for restart of economy with extended range of flexible tractor contracts

New Iveco lease options By George Barrow

Iveco OK Trucks is to expand the terms available on its low-weekly full R&M tractor unit operating lease deals. Previous offers for low-mileage Iveco Stralis tractor units were limited to a fixed year and mileage term, but the offer through Iveco Capital will now include two- or three-year leases, with 90,000km, 130,000km, 160,000km or 200,000km per annum caps. Contract rates will start from £249 per week on a three-year, 90,000km package on a 2016 Stralis 6x2 with full R&M. However, the majority of customers will opt for

TIP doubles up with Nuneaton ‘super-branch’ TIP Trailer Services had opened a new flagship depot next door to its existing operation in Nuneaton. Built on a brownfield site, TIP said the “super-branch” was its biggest-ever investment in new workshop facilities. The 10-acre site contains a purpose-built 10-bay workshop, brake roller testers and an MoT lane to double the current service capacity. Mike Furnival, TIP UK and Ireland MD said: “We will continue to invest in our infrastructure to match the increasing demands of transport. The commitment of our people and the loyalty of our customers demand that we improve conditions for the future health, safety and prosperity of our industry.” 22.6.20

a 130,000km lease, which will cost £269 per week with offers available on both MY2013 and MY2016 variants of the Stralis Euro 6. “This offer is probably the most inclusive pre-owned offer on the market,” said Brett Reid, OK Trucks pre-owned market manager. “It’s not top of everyone’s shopping list to replace vehicles at the moment, but these new offers are going to be around for the rest of the year and they’re now more flexible than before, allowing operators to get a young tractor unit that comes fully supported.” Trucks typically have between 200,000km and 300,000km and

have previously been run on another operating lease from new. They have a full Iveco service history and have been refurbished with a 120-point quality. They will also have at least 6mm of tread on the tyres and all fall within the OK Trucks Premium offering, which is the highest level in its used truck programme, above OK Trucks Comfort and OK Trucks Standard. “We’re starting to see a few green shoots of recovery and our message is that we have a supply of trucks like this available at short notice and we can now tailor the [finance] package to suit even more customers,” added Reid.

Truck auctions move online... for now The truck auction houses have moved to online sales through the coronavirus pandemic and report that buying activity is beginning to increase. Buying commercial vehicles online in real time has traditionally been done in tandem with the physical auction. However, the Covid-19 pandemic has changed this, explained CVA’s MD and auctioneer Ross Dalton (pictured). It ran an online-only light commercial vehicle (LCV) auction sale in March with a live auctioneer. He said: “We then reopened to trial the same LCV format (at the end of April) with the added aspect of 360-degree video appraisals on all running lots. “We then conducted an HGV auction on 5 May, which was our largest online attendance in history. Prices were good, proving there’s quite a lot of interest in the used marketplace.” He added: “For the foreseeable future auctions will be held in this way. Hemel Hempstead opened with the first auction held on

27 May. Scotland has also opened with the first auction set for 22 June.” Since the restrictions were eased Protruck Auctions, part of the Fleet Auction Group (FLAG), has conducted three online truck and trailer sales. At the most recent sale (Tuesday 9 June) a power cut ended the action when just 60 of the 350plus lots had been sold. “Luckily, because it was online, we were able to reschedule it for the following day,” said Charlie

Wright, MD and auctioneer at Protruck Auctions. This brought added interest with more buyers registering, he said: “It added a bit of drama. Had it been a physical sale combined with online we’d have had to continue with the people who had attended the sale, without the online buyers. Being online only was a bit of a saviour.” FLAG has also conducted half a dozen van sales in addition to its truck and trailer sales.

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News

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Affleck named dealer director at Scania east The new Scania (GB) dealer director for the east region has been named as Steve Affleck, who will oversee the sales of new vehicles and the service delivery. His remit covers the area between Boston in Lincolnshire, Sheffield and Kingston upon Hull. Affleck has spent his career within the automotive industry in sales and aftersales roles, eventually becoming a regional director for an independent commercial vehicle dealer group, and time at Scania’s former southern England dealership, Southway Scania. “It is great to be rejoining the premium Scania brand,” he said. “The team in the east region have built an exceptionally strong business over the years and I am looking forward to working with them as we develop and boost sales and the range of services we provide to the region’s transport operators.” Martin Hay, Scania (GB) MD, said: “His extensive experience and industry knowledge make him an ideal choice for the position of dealer director, and I know his reputation as a people-person will serve him well with customers and colleagues in our east region.”

Race is on to grab McLaren’s stars By George Barrow

Operators who dream of being a racing driver might want to visit a Volvo Used Truck Centre as the fleet of 24 Volvo FH 4x2 tractor units previously run by the McLaren Racing Formula One team is being sold through the network. The 18-plate trucks have been working as part of the F1 circus for the Woking-based team, transporting the team’s racing cars and equipment as part of the European rounds of the championship. The metallic silver trucks come with an official certificate of authenticity and a wealth of McLaren Racing merchandise including a cap

signed by McLaren drivers Carlos Sainz and Lando Norris. The trucks have an exclusive McLaren Racing badge in the cab and have been specified with Volvo’s D13K engine producing 540hp and 2,600Nm of torque. The left-hand-drive units are also equipped with an I-Shift transmission and have I-See predictive cruise control. There’s a choice of two different chassis heights (X-Low or Medium) and the trucks have a range of mileages on the clock from 30,000km to 60,000km. Carl White, national sales and brand manager at Volvo Used Trucks, said: “These are very special vehicles and we’re expecting

a lot of interest from owner-drivers and fleets doing mostly continental work. So far as specifications go, they’ve got pretty much every option on them factory fitted, including refrigerators, microwaves and luxury leather interiors. They have been maintained in showroom condition by McLaren Racing, with all servicing work carried out within the Volvo Trucks dealer network.” The trucks are available through Volvo’s 14 Used Truck Centres and are backed up by Volvo’s Selected warranty, which includes 24-months driveline cover that can be extended to 36-months of European back-up.

Keeping the trailers rolling top of TIP’s priorities Throughout the coronavirus pandemic TIP Trailers Services kept its 119 sites across Europe open. While the company said ‘protecting our employees and following stricter measures in the way we are conducting business’ was vital, the businesses underlined its commitment to customers. It has more than 113,000 rental assets as well as third-party main24 MotorTransport

tenance agreements through the European network. In the UK and Ireland it has 15 workshops, with 500 employees looking after 16,000 rental products and maintaining an additional 30,000 assets and 800 trucks and trailers through Grayrentals. Mike Furnival, MD of TIP Trailer Services covering the UK and Ireland, said: “We furloughed

approximately 10% of the staff in the UK, mainly those with underlying health issues so they could self-isolate, and apprentices because we couldn’t have mentors working physically close to them.” There was a 5% dip in utilisation to 87% but with most assets out on long-term deals, the drop came mainly from those who took assets on short term and spot rental agree-

ments. He said: “We have had requests to reconstruct payment terms and we have set up appropriate plans for repayment schemes. “We have stress-tested the market and April was pretty much as we forecast. We didn’t get the big fridge pick-up we hoped to see, and we got more curtainsided trailers back than we bargained for, but it has all balanced out.” 22.6.20

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C E L E B R AT E S U C C E S S B O O K Y O U R TA B L E N O W 17 NOVEMBER 2020 w w w. m t a w a r d s . c o . u k GROSVENOR HOUSE HOTEL, LONDON @motortransport

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Marketplace

Investment

equals growth I NEIL PARK: critical to invest in Inverness potential

To cope with demand following growth in parts, sales and workshop, Volvo Trucks UK spent £1m to double the size of its wholly owned facility at Inverness. Kevin Swallow reports

f you are going to present a business case where money, and especially someone else’s money, will be spent you need to be able to justify it. Last year Volvo Group UK spent £1m doubling the workshop space at its wholly owned Inverness site. Built 20 years ago on Longman Drive as a purpose-built dealership, it replaced the original smaller site down in the harbour that had opened as a parts and service facility in the early 1990s by Eurotruck before it became Volvo Scotland in 1997. By 2009 there was enough demand for the workshop to go 24 hours during the week, backed up with weekend shifts. Since 2015 there has been steady and sustained growth in parts, sales and workshop hours. Growth in sales from 2015 to 2019 has seen market share more than double from 14.7% across the Highlands to 30.1% for vehicles over 16 tonne gross vehicle weight (GVW). By comparison the national market share for Volvo Trucks UK has stayed at 15% over the same period. Success is thanks in part to Volvo revamping its sales coverage and putting in a salesperson to cover the Highlands and islands exclusively. The knock-on effect has been an 82% growth in contracted work through repair and maintenance, a 35% rise in retail workshop hours and 39% increase in parts sales. “In that period, we have also employed a further seven mechanics taking us to 22 technicians, which includes apprentices,” says dealer manager Iain Dickinson. He joined Volvo as a technician back in 2005 and progressed steadily through the workshop ranks before being promoted to his current position in Inverness in December 2014. Within a few months, Dickinson identified a need for a dedicated sales resource and believed there was untapped potential. Senior management

supported Iain on this and in 2015 Kevin Fraser was transferred from parts to sales as that aforementioned dedicated salesperson for the Highlands. He joined Volvo at Inverness in 2009. His background is as an apprentice and time-served vehicle spray painter before spending time with Chisholm’s Recovery before joining Volvo in the parts department and going on to become parts supervisor, where he got to know Volvo truck operators.

Hit the road

Historically, the operators located in the Highlands have articulated trucks working across construction, oil and timber. Sales of tractor units continued strongly and was increasingly supported by rigids. Most smaller distribution vehicles came into the Highlands from further afield to deliver, but there was enough across the region for Fraser to try to develop rigid sales too. During his first year in sales he put 25,000 miles on the company car visiting customers and operators. He says: “People were happy to see someone from Volvo. We have done well with rigids, and go right down to 10 tonne GVW – that market was a bit untapped. KEVIN FRASER: tapped in to market for smaller vehicles

Tom Cunningham

“With fewer people able to drive 7.5 tonners on a car licence through grandfather rights it meant we could try to push operators towards the slightly heavier weights because their driver would be on an HGV Class 2. The GVW was not overly important; what did matter was the quality of service and longevity of the vehicle.” Neil Park has monitored the growth from Inverness and recognised the dealership would need investment to help it cope better but also to move the dealership forward. He is the regional managing director at Volvo Truck and Bus Centre North and Scotland, which includes 12 sites and employs 430 people. Inverness is the most northerly point on the Volvo map in the UK, and it covers a third of Scotland’s landmass, some 17,000 sq miles. Historically, the dealership was seen as a small but essential place on the map. “In the past five years it has 26 MotorTransport

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EYE ON THE PRIZE: dealer manager Iain Dickinson pushed for a greater sales presence

grown and developed into a major depot in its own right that does 30,000 hours a year through its workshop. “The growth is down to the quality of service, the availability and the flexibility of the service provided by the local team,” he explains. He recognises the success of putting in a dedicated salesperson for the Highlands. “Kevin has done very well, especially with R&M contracts with trucks and that has been an excellent feeder channel for the workshop. And the quality and flexibility of the workshop helps Fraser to sell R&M to customers. “One critical area is parts availability. Inverness stocks 5,400 parts lines and has a 94% first time pick, which is higher than average across the network,” he says. “I always say we only do three things; we sell trucks, parts and workshop hours. The growth in all three has earned the right to the investment and it’ll be a springboard to grow the business even further.”

Peak performance

Park points to the 98.2% first time MoT pass rate, which is one of the highest in the Centre North and Scotland group, and the dealership’s ability to generate repeat business. “At 52% [2019 figure] Inverness had one of the highest ratios of retail work in the dealership group,” he reveals. “I am a great believer in that if you are doing well with retail you are doing something right because that is a customer spending their hard-earned cash with you, and they only do that if they like what you do for them.” He praises the team at Inverness for their willingness to take on work, whether it is a routine inspection or any type of roadside breakdown. “Inverness is at least two hours from any other major area,” he says, “so staff are willing to adapt to the customer’s needs because of the type of area they cover. They have not refused one Action Service breakdown emergency call in three years.” The investment is as much about improving the conditions for the staff as it is about providing a greater service to customers (see box, right). Growth in the past five years has meant the operation has outgrown the depot, which meant technicians have been occasionally repairing equipment in the yard. “For me, that is not acceptable. We couldn’t take on more people or work because we didn’t have the facility to do so. The investment has given the team the right environment and foundation to further improve the service they deliver with greater efficiency.” Park adds: “With the money spent comes a five-year business plan for sales growth and employing more people as its direction of travel. It has the potential now to grow. Inverness covers a wide and challenging area with a lot of customers within it that we can support.” n 22.6.20

LOOKING AFTER THE NUTS AND BOLTS Back in 2015 Volvo decided to add an authorised test facility (ATF) at its Inverness site for customer and third-party MoTs. It was open for three-and-a-half days a week, explains Iain Dickinson, who adds: “When TOM Rental closed its doors in Inverness, we saw growth in residual work and MoTs. The ATF is now open four days a week.” If operators are going to travel from remote parts of the Highlands, the dealership needs to be equipped to provide a full range of services, so the trip is not wasted. He says: “Having the ability to brake test trailers here is a big selling point. For trailers more operators are specifying electronics that record brake testing by measuring the brake force and weight.” The £1m spent on the site includes a four-bay extension that has doubled the workshop space. “Previously, we had two full-length bays, or four single bays, in the workshop and two bays for the ATF, which we could use one day a week. With more work we always had to prioritise what vehicles we worked on to try and fully utilise the space. With another four bays to the end of the workshop with a full-length pit, it means the technicians have more space and don’t have to keep moving vehicles around. And there is an overhead crane in the new section where we overhaul engines and gearboxes.” He says that as well as more space it has improved the working environment for the technicians: “Everyone can work inside; it’s a better environment and it helps produce a better quality of work that will be right first time. “These additional bays are 3m longer and we still have an exit lane around the side, which means we have retained our drive-through workshop.” That investment also includes upgrading the parts store with a carrousel for the smaller parts, which has freed up space to increase more storage, and a new meeting room.

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MT Awards 2020 shortlists Haulier of the Year MT profiles the shortlists for this year’s awards