Under fire!

Our industry, its trucks, and its drivers are under fire. This has massive consequences…

Crime in South Africa is something that we’re used to – which is completely and utterly wrong. Much like the frog in the boiling water, it’s become part of our daily lives. We’re not jumping out as the water heats up, because we’re so accustomed to it. Some people even think it’s normal.

It is not. Things are quite different in many other countries.

Even our massively unpopular Police Minister, Bheki Cele, has acknowledged that the number of murders in this country “remains high and worrisome”. A total of 6 424 people were murdered in South Africa in the first quarter of the 2022/2023 financial year (664 more than the same period a year ago), he revealed in a speech announcing Quarter One crime statistics.

Cele highlighted that “the reporting period of April to June shows that South Africa was brutal and dangerous for women and children”.

“Violent crimes committed against women and children recorded alarmingly high and unacceptable levels. From April to June 2022, 855 women and 243 children were killed in South Africa,” he revealed. The statistics are horrendous. They are shocking. Honestly, why are more South Africans not up in arms about this? Yes, I know. It’s the frog situation again.

Unfortunately, Cele didn’t touch on yet another criminal scourge: the ongoing attacks on trucks and drivers, which have also seen people slaughtered. While the loss of human life is obviously the most horrendous consequence of these attacks, it is but one of many implications.

As Gavin Kelly, chief executive officer of the Road Freight Association, points out, the wanton destruction of trucks and goods has begun to undo the status of South Africa, both as a safe haven for investment and as an efficient logistics hub for foreign traders.

“What started out as sporadic incidents on one or two routes, has become the norm on any and all routes of the total supply chain, and is affecting destinations and originations. With the total supply chain now being impacted, the economic effects are far-reaching. Whilst short-term losses run into millions of rands, the long-term impact is incalculable and will be felt long after the burning has stopped and when it is far too late,” he warns.

These are just some of the consequences, as Kelly points out:

• Depending on the category of vehicle, the type and value of cargo, and the specialised equipment required for the cargo, the financial impact can be anywhere between R3 million and R10 million.
• Costs from the loss of income through business closure are even greater: there are instances where small businesses have lost their only truck (or trucks). This means loss of earnings/revenue for the business, loss of salaries for staff who lose their jobs when a business shuts down, and loss of revenue for the business’ suppliers (for fuel, storage, maintenance, tolls, staff requirements, licencing, etc).
• Potential business closures mean fewer transporters available to perform work. Some companies might feel the industry is not a safe/secure environment, so owners could decide to simply close their businesses.
• Instead of sending freight through South African ports (especially the Port of KwaZulu-Natal and along specific targeted corridors), cargo owners and/or customers will choose to move cargo through neighbouring countries. This has already been happening as South African ports become increasingly inefficient and the surrounding ports develop, improve, and drive efficiencies up. South Africa’s “Gateway to Africa” status has been lost; these attacks will further cement the move of transit freight to our neighbouring countries. Port revenues will drop, as will income through all support and related freight logistics users.
• Costs relating to insurance will increase, as the risk to insurers has increased over the last four years, partly as a result of the constant attacks on freight. The evidence is clear that road freight is attacked because it is an easy target, while the looting prospects are huge in terms of the quantity and variety of goods.
• Security costs will increase as logistics companies are forced to employ guarding services. Routing will change to safer (but perhaps far longer) routes, where control is easier.

Kelly notes that the consumer will foot the bill for what has happened – through both indirect charges relating to the cost of logistics and as risk appetite softens and insurances demand more for premiums. “Supply and demand will dictate cost,” he points out.

Exactly what costs are we looking at? “The cost to operational assets is just the tip of the iceberg,” Kelly warns. “As reports come in, this may very well grow, however, the cost to the South African economy will run into billions of rand lost, as business confidence from foreign investors plummets and those who use South Africa as a transit hub turn away from us and move to other countries that are safer and more efficient.”

He says that it’s time for action on the part of government: “The Association reiterates its call to the president to ensure that common violence is dealt with. The level of opportunistic crime is far too high – it needs to be dealt with now. Time and again the Association has called for the rule of law to be shown to be firmly in place and that the safety and security of South Africa and its people be ensured. Government needs to act swiftly and decisively to bring an end to this senseless destruction of the road freight sector.”

I would hasten to add that government doesn’t just need to end the destruction of our industry. It needs to stop any and all crime in South Africa. We don’t want government officials who simply stand on a podium and spout crime statistics. We want government officials who take action against the criminals, who – for now, at least – appear to have the upper hand in our country.