Fuel Charge Out Rate – Sept 2015

[Chris RoseKeymaster]

Folks,

I am sure you are aware that the fuel charge out rate has been amended on the first of September 2015, this is designed to bring it in line with the current rate that CEMEX are paying across all of the fuel cards issued to the IHC fleet.

The change from £1.02 per litre to £0.93 per litre will actual mean that you will be deducted far less per month moving forward for the fuel you use on the CEMEX issued fuel cards. The change represents quite simply £9 less per 100 litres that you put in your truck.

This has had an effect on hiding the increase in rates however the increase is still there, if you pay less for fuel on roughly the same rate per load you will be generating more revenue for your business as your outgoings will be lower.

Rest assured that your backpay on both loads & sundries will be calculated using the fuel figure of £1.02 per litre as this is the rate you were paying at the time the workload was completed.

Regards

[Paul JeffreyParticipant]

Have cemex passed the fuel reduction onto the price of concrete, and lowered the price?? to the customers to generate more work????

[Chris RoseKeymaster]

Paul,

It is not as simple as just passing on a saving to the customer. As with any business CEMEX had a budget at the start of the year with lots of targets.

All of these targets are monitored and include;

Haulage Cost targets (which included a fuel cost reduction in the budget anyway)
Average Selling Price targets
Volume targets

etc etc

Not all areas are meeting their targets as we all know, volume being the one that impacts the IHC fleet the most. Some areas are not hitting their targets in terms of haulage cost & others in terms of average selling price.

The change does however provide the areas of the business with more options to deliver more volume to the fleet. If there is less pressure on haulage cost as a result of fuel reduction then we can target work slightly further away whilst still meeting targets or we can selectively sell below average selling price and still come in on target.

The process to gain extra volume if required will be different in each area and will depend on local circumstances, however I would suggest that you request from your ops super or cluster manager a briefing on how your local business is doing & what is in the pipeline for the future.

Regards

[Paul JeffreyParticipant]

Chris.
At the start of the year the productivity / volume targets should have been reduced in the northern area if they are being monitored, we are no where near them each year. Also, how was it agreed to increase the guaranteed day to £270 (in black and white). to be told it’s being reduced to £266 a few weeks later? Who authorised this ? was it negotiated at any hauliers meetings? after all it was agreed at £270. or was it enforced onto us?

Thanks Paul.

[Chris RoseKeymaster]

Paul,

The guaranteed day included in the offer this year was 5 loads at a 5 radial averaged across the UK 6 metre fleet (excluding London), this is going to be the mechanism moving forward & this means that the guarantee will move as rates go up or down, in general it is rare for the rates to go down so this change is as a result of the fuel rate being lowered as mentioned above.

What this does mean is that having agreed that 5 loads at a 5 radial is a fair guarantee that we will not be debating over what it should be in the future. So as the fleet gets newer the average will rise, when we are agreeing rates next year the proposal will be at the average at that time. With hopefully more new trucks on the road the guarantee will increase.

This is by far the fairest method of calculating what the guarantee should be & ensures that it moves every year in line with rates.

Hope this helps explain the situation

Regards

[mlstevensParticipant]

Chris
In the Rate offer you said the Guarantee would be calculated as the rate stands on the 1st April each year. As the Fuel at the 1st April was £1.02 meaning the rate was higher as used for our back pay. Why now has the Guarantee been calculated using £0.93 fuel cost that wasn’t adjusted until September. Can you refer back to the offer made to us and advise please?

[Author]

Posts