A ‘NEW NORMAL’ has replaced ‘unprecedented’ as the most popular description of events surrounding the coronavirus pandemic. For anyone involved in freight by road that ‘new normal’ doesn’t seem to respect traditional business models struggling to cope with a downturn in volumes.
So far, the most well-known haulier to ‘cease trading’ is Morris Young, based in Perth. In an interview given to local newspaper The Courier, second generation brothers David (74) and Colin Young (71) said the risk of coronavirus was too great and that they had ‘no idea’ what type of haulage industry they would be returning to with the 72 year old business set up by their parents Morris and Janet.
It had furloughed staff and then ceased operations during the lockdown resulting in the loss of 16 jobs.
The fear is that Morris Young won’t be the last. There is an industrial level of bean counting taking place behind closed doors with one eye fixed firmly on the calendar. Many consider just how long they can hold out.
Fewer employees are now furloughed by hauliers, but many bosses are talking about some sort of financial restructure and/or downsizing. One MD is looking at residual values of rolling stock, another revealed a plan to place greater reliance on sub-contractors, while a third vowed to work ‘smarter’. Transport News has touched on these issues with Commercial Vehicle Auctions (page 64) and Aptean’s Paragon Software Solutions (page 48).
The effect of the coronavirus lockdown on infrastructure is less obvious, although some local authorities running out of money are reducing the number of household rubbish and recycling collections. By the same token county councils continue with pre-planned resurfacing projects with the money ‘deemed already spent’.
As residents’ nostrils cope with unemptied bins and newly laid asphalt those on furlough have become reacquainted with the local postie. Yet birthday cards, envelopes with windows and flyers have not sustained the Royal Mail through the pandemic, so news that it will cut 2,000 jobs across the business from its management roles, aiming to save £130m in costs, is significant.
It has acknowledged that more focus should have been not on letters, but parcels. Delivery vans flood the cul-de-sacs as e-commerce continues its relentless march at the expense of the high street (and seemingly the Royal Mail).
Preston based Knowles Transport is setting its sights on moving into the e-commerce arena having supported its customers with their online offerings throughout the pandemic period.
From the beginning of lockdown Knowles, in addition to managing an initial 30% spike in volumes, has been responsible for picking, packing and distributing over 20,000 food parcels for emergency services staff on a daily basis. It was an exercise which has been a great success laying the foundations for Knowles Transport to build its e-commerce offer in the future.
It has never been a company to stand still throughout its 88 year history and its move into the e-commerce sector will be no exception. With over two million square feet of warehouse capacity nationally, Knowles is well placed to add e-commerce fulfilment to its service portfolio.
Parcel giant DPD announced 6,000 new UK jobs and a major infrastructure investment in response to the ‘unprecedented boom in online shopping’ caused by Covid-19, with 650 of these new jobs in Scotland including 500 drivers and around 150 warehouse and management roles.
The firm is set to invest £200m this year to expand its next-day parcel capacity, including £100m on vehicles, £60m on 15 new regional depots (10 more than originally planned) and the remainder on technology.
That glimmer of hope was supported by Andy Haldane at the Bank of England. As its chief economist, he stated that the recovery in the UK and globally had come ‘sooner and faster’ than expected and believed the UK economy is still on track for a quick, or V-shaped, recovery.
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