Australia’s peak trucking bodies have welcomed the Federal Government’s decision to fast-track changes to allow fuel costs to be passed through the supply chain, but warn that more immediate support is needed to prevent business failures across the transport sector.
The move follows a dramatic surge in diesel prices, which industry leaders say has placed unprecedented pressure on operators already working on narrow margins.
A response to an historic fuel price spike
The Australian Trucking Association (ATA) has strongly backed the Government’s announcement to amend the law to enable urgent fuel price orders across the road transport contract chain.
ATA CEO Mathew Munro said the rapid escalation in diesel prices had created an emergency situation for many operators.
“Trucking businesses cannot absorb this increase, and most cannot pass it on. Without immediate action, the trucks will stop. And when the trucks stop, Australia stops,” Mr Munro said.
Mr Munro noted that the terminal gate price of diesel had climbed from less than $1.66 per litre to more than $2.95 per litre, describing the increase as the largest fuel price spike in history and warning there was no clear end in sight.
The proposed legislative change would allow the Fair Work Commission to issue urgent contractual chain orders more quickly, helping ensure rising fuel costs can be passed through to customers rather than absorbed solely by transport operators.
Support welcomed, but cash flow remains the immediate risk
The National Road Transport Association (NatRoad) has also welcomed the Government’s action, describing it as a necessary first step, while cautioning that the timing of cost recovery remains a major concern for operators.
NatRoad CEO Warren Clark said that even with faster contractual arrangements, transport businesses would still face a delay between paying for fuel and receiving reimbursement through contracts.
“Allowing faster contractual chain orders will help ensure fuel cost increases can be passed through the supply chain more quickly, but truck operators are still carrying the cost upfront. Many will still be paying for fuel weeks before they see any return through their contracts.”
Mr Clark warned that this lag was placing severe strain on cash flow for businesses already operating under tight financial conditions.
“For businesses already operating on razor-thin margins, that lag is putting enormous strain on cash flow.”
Calls for additional emergency measures
Both organisations have called for further action to stabilise the industry while the new regulatory mechanisms are implemented.
The ATA has urged the Government to consider temporary measures including removing the road user charge on heavy vehicle fuel and expanding access to high-productivity freight vehicles that can move more goods using less fuel.
NatRoad has proposed additional financial support measures aimed at protecting small operators from insolvency during the transition period.
“We are also asking the Federal Government to request that banks and equipment lenders implement a six-month moratorium on equipment lending repayments for the heavy vehicle industry, similar to the support provided during COVID,” Mr Clark said.
He said this approach could provide operators with critical breathing space while fuel cost pass-through mechanisms take effect.
“This measure would give operators critical breathing space to manage their cash flow while fuel cost pass-through mechanisms take effect.”
Supply chain impacts extend beyond the transport sector
Industry leaders have emphasised that the consequences of sustained fuel cost pressure extend well beyond transport businesses.
Mr Clark warned that widespread operator closures would inevitably affect the cost and availability of goods across the economy.
“If we don’t act decisively now, we risk seeing more transport businesses close — and that will ultimately drive up the cost of goods for every Australian.”
The message from both organisations is consistent: regulatory changes to support cost recovery are necessary, but immediate financial relief will be critical to keeping trucks on the road and maintaining supply chain stability during a period of ongoing fuel price volatility.
