'Sucking up' fuel price increases

LIBBY WILSON
Last updated 09:50 20/07/2013

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Fuel prices are on the rise and petrol has reached an all-time high, but many consumers seem resigned to this shock to the wallet.

BP's price for non-discounted 91-octane petrol is now at a record high of 226.9c a litre, while its diesel price has hit 157.9c a litre, and a 3c petrol tax increase kicked in at the start of this month.

And the rising fuel costs are hitting farms hard but there is nothing to do but "suck it up," said Peter Denton, who has a lifestyle block in Rukuhia.

He is glad to be working fulltime, with farming as a small sideline income.

"Once upon a time, $20 would get you plenty of mileage. But nowadays you're lucky if you get out the farm gate," he said.

But putting more money into fuel for machinery wasn't the only challenge - he said spreading fertiliser, cartage for stock, and even tradesmen's callout fees were affected.

Road Haulage Te Awamutu owner Warren Whittaker was also resigned to the soaring prices, expecting his fleet of 10 trucks to cost him around $60,000 in diesel this month.

"You just try and cut costs . . . and get on with it."

He switched to Scania vehicles years ago because of their reputation for fuel efficiency, and says there is little more he can do now.

David Aitken, chief executive of the National Road Carriers' Association, said those in the competitive, low-margin transport sector were always searching for ways to cut costs.

The association encouraged members to have a fuel factor in their contracts.

He knew of companies using a variety of methods to reduce fuel costs, including putting staff through driving courses, or daily monitoring of fuel prices to find the lowest-cost provider.

Technology that monitored and helped improve driver behaviour - including acceleration, fuel consumption and braking - was also making an appearance, he said.

AA PetrolWatch spokesman Mark Stockdale said record petrol prices were the result of a "perfect storm" of higher taxes, a falling New Zealand dollar and rising commodity prices.

But he said taxes where what pushed prices over the edge this time.

"If we hadn't had a 17c increase in tax in the last five years, then the retail price would be $2.10."

libby.wilson@fairfaxmedia.co.nz

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- Waikato

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