Steer clear of trucking – economist

Anyone who thinks trucking is a good investment and a way to make money is far from right. According to economist Mike Schussler, truckers at any given point in time will only be making a profit margin of around 4% – and in light of the host of challenges they have to deal with, that’s not much. “Trucking is an exceptionally tough industry to be operating in at present,” he told FTW. “Trucking is not an investment as one is only getting around 4% profit. In fact, if you were to put your money in the bank you would get around 5% – a whole percent more without the hassle of labour issues, fuel increases, the lack of road infrastructure and so on.” He said the transport strike in 2012 alone was estimated to have cost the sector a whopping R1.4 billion. “The past year in particular has been extremely severe for this industry. It has not yet recovered the massive strike losses and the fuel costs have almost doubled in the past four years. Last year alone the fuel price increased by 16.1% while labour costs increased by 9%.” He said the country was losing massive amounts of money to long, drawn-out strikes. “South Africa is a country living beyond its means. It is in very dangerous territory as we are reliant on foreign portfolio flows coming into the country and the ratings downgrades, wildcat strikes and other challenges have not had a positive impact at all.” INSERT 4% The profit margin that truckers can expect. CAPTION Mike Schussler … ‘Rather put your money in the bank.’