CTA survey shows COVID-19 severely straining trucking industry, federal relief needed
CTA is asking the Government of Canada to introduce a Payroll Tax Deferral Program, providing fleets the needed cash to maintain operations
While public support and appreciation for truck drivers during the COVID-19 crisis remains high, a recent survey by the Canadian Trucking Alliance shows that federal aid is now required to provide needed relief to trucking companies whose operations have been severely strained by the impact of the pandemic.
"The Canadian trucking sector has worked as hard as it can during this crisis to ensure Canadians continue to have access to essential items such as food and sanitary products," said CTA president Stephen Laskowski. "But it is becoming increasingly clear that as our industry continues to serve the supply chain and economy as required, it also faces unique and rapidly escalating challenges that requires tailored solutions to protect the stability of the supply chain during the COVID-19 crisis and its aftermath."
The Government of Canada has introduced several financial measures to assist Canadians and businesses generally suffering financial hardship as a result of this pandemic, says Laskowski. "But, simply put, our sector needs additional, focused assistance above and beyond what the Canada Emergency Wage Subsidy (EMS) provides due to the nature of our sector and the critical relationship it has to the supply chain. Although, the EMS may work for many sectors, it does not stabilize the Canadian trucking industry."
To ensure security and stability in the supply chain, CTA is asking the Government of Canada to introduce a Payroll Tax Deferral Program, providing fleets the needed cash to maintain operations. Additionally, CTA wants an increase in the meal allowance for all truck drivers facing rising costs associated with operating during COVID-19.
The reasons for this needed relief was spelled out in a recent CTA Business Conditions survey. In total, close to 100 CTA-member fleets from across Canada - representing 60,000 Canadian workers - participated in the survey.
The survey revealed the following:
• On average carriers have experienced a 27% decrease in revenue;
• Carriers report a 300% increase in ‘empty miles' (The condition when trucks are travelling, but not generating any payload revenue for their services);
• Without an improvement in conditions, 37% of fleets have significant concerns regarding the continuation of their operations;
• Sixty-three percent of fleets indicated their customers have recently asked for payment deferrals or simply have not paid the trucking company for their services.
Several trucking companies say they are quickly approaching the ledge of a perilous ‘freight cliff'. While many trucks are moving COVID-19 product and keeping store shelved stocked, they struggle to find return freight, leading to evaporating margins and the inability to cover the full cost of operation. They report customer demands for their services are disappearing while payment and collection issues are mounting.