Top 5 Problems the Trucking Industry in the Philippines is Facing Today

The growing economy of the Philippines attracts with it a growing demand for trucks to transport goods, equipment and other supplies. Many industries even choose to venture into building their own fleet of trucks and bigger companies expand into a logistics company of their own.

The trucking industry is growing and opportunities are greater but the emergence of new problems and the old issues are also piling up affecting the small players and most especially, the drivers.

1.    COVID 19 and IATF Policies 

With varying quarantine protocols, referring to COVID19 recovery status, respective LGUs are depending on IATF policies and guidelines that can affect schedule of deliveries of shipments.

2.  Traffic Situation

Construction of main roads and highways should be a good sign of development, however, if substandard materials are used in the frequented pathway used by big trucks, it is prone to wear and tear. Many urban developers suggest looking into strict monitoring of public road infrastructures.

Some concerns are:
•    Old, two-lane roads, suggestion for road widening of driveways
•    Unregulated issuance of franchises to tricycles, jeepneys and other public utility vehicles (PUV)
•    The lack of urban planning that leads to endless road constructions
•    Poor and small drainage systems that need frequent rehabilitation
•    Lack of expertise of local officials in facilitating local traffic management
 

3. Truck Ban
 

This problem affects trucks coming to and from ports of Manila and nearby ports. It is a long withstanding issue where traffic management agencies in the local and regional level point fingers to trucks as the major cause of road congestion in Metro Manila. Even motorists share the same notion because of how the trucks and its drivers are usually depicted as slow-moving and the usual cause of road accidents.

As the traffic gets heavier, the truck ban policy got stricter from having a travel window to totally banning it along EDSA. Many cities and even municipalities in provinces also adopted a policy of their own. Despite the truck ban, heavy traffic remains and it gets worse as soon as the truck ban window is lifted. Urban planners and policymakers have been reviewing this policy and have been proactively sharing suggestions on how to make the traffic situation in the metro better including the total lifting of the truck ban and disproving trucks’ contribution to heavy traffic.

The economic implication of the truck ban must also be taken into consideration. This can delay deliveries that can affect the economy and the income of the byaheros who earn on a per trip basis, without overtime pay. 

4.    The oil price hike and fuel taxes
 

These two go hand in hand. The oil price hike is caused by various factors like the oil prices at the world market, the supply and demand and the prevailing Philippine Peso to US Dollar exchange rate.

Excise tax on fuel is implemented alongside the TRAIN Law in 2018. For trucks which are diesel users, a 3-tranche increase will happen in the following succession, Php2.50 per liter in 2018, Php4.50 per liter in 2019 and Php6.00 per liter in 2020.

Both of these affect the trucks and their fuel expenses. But most service providers cannot simply pass on the cost to their clients, they are shouldering a big chunk and most of the time, they are at a loss.

5.    Truck Maintenance or Acquisition
Trucks as a company asset, needs continuous upgrade and maintenance. Last 2018 the Land Transportation Franchising and Regulatory Board (LTFRB) has issued a memorandum circular which allows truck operators, including those who have units that are more than 15 years, to continue operating on their franchises as long as they pass roadworthiness tests conducted through the motor vehicle inspection system (MVIS) of the Land Transportation Office (LTO).

It is ideal to acquire new truck units but as we have enumerated some challenges above, these have direct impact on the wear and tear of units as well. The 2019-2020 natural calamities have damaged roads and trucks who have been servicing those affected areas.

Every now and then, logistics have to be resilient as a business and this entails on quickly adapting to rules and regulations.

Ernest Logistics Corporation has been very keen in observing these situations in order to provide the best solutions to its growing clientele. While we manage these challenges, we let our customers focus on their core products or services. We believe that pivoting to better strategies need more dependable, quick, and effective collaboration among sectors of private companies and both local and national government units.

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