ENDORSED BY
Intraregional supply chain solutions from producer to t consumer
Logistics Optimising transport routing and scheduling
Corridor Improving logistics between Durban and Gauteng
Commercial Vehicles The road ahead in 2013
Appropriate technology for Southern Africa IIN N THE HOT SEAT
“Scania Trucks have been developed for use in the most demanding market� Steve Wager, MD, Scania SA
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ISSN 1684-7946 Jan/Feb 2013 Vol. 11 No. 1 / R40.00 incl. VAT
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TRUCKS. LEASING & FINANCING. FLEET SOLUTIONS. SERVICE & PARTS
Trust means any time, anywhere, down the road. In Mercedes-Benz you have a partner who reacts immediately in an emergency to make sure that your journey can continue without delay. Wherever you ďŹ nd yourself and whatever the time, our Customer Response Centre is there for you. One free phone call is all it takes. What’s more, you can count on our service outlets throughout South Africa to provide you with genuine parts and everything you need to keep moving. It is reassuring to know that you can always rely on service with the three-pointed star. Call: 0800 133 355 or visit www.mercedes-benz.co.za/trucks
Intraregional supply chain solutions from producer to consumer onsumer
COVER STORY ORY
INSIDE
UD Trucks ucks Fuel is playing g an increasingly vital role
THIS ISSUE
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REGULARS 2 3 4 6 8 10
Editor’s word – Eternal optimist in 2013 FESARTA – Barney’s comment Cover story – UD Trucks Hot seat – Scania’s Steve Wager FESARTA news News desk
LIGHT COMMERCIAL 24
SA’s manufacturers remain buoyant
SUPPLY CHAIN LOGISTICS Optimising transport routing and scheduling Tracking into the future
26 28
COMPANY PROFILE 12
Ngululu Carriers – Expanding into Africa
MARITIME Unlocking the great potential in Africa
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COMMERCIAL VEHICLES The road ahead in 2013 MAN – Optimistic about 2013 for both truck & bus Scania – Ensuring efficient reliable transport solutions
16 18 22
REGIONAL CORRIDOR FOCUS Improving logistics between Durban and Gauteng
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RAIL TRAILERS
The role of rail in intra-Africa trade
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Trailers deliver optimum performance
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Transnet branch lines critical in stimulating economy
36 38
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TWA | Jan/Feb 2013
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ED’S WORD
Eternal optimist in 2013 T
he road ahead might be tough in 2013 but, as they say, without challenges there would be no opportunities! Am I optimistic about the road ahead? Yes, I am. But I have always been an eternal optimist irrespective of the challenges I am experiencing at the time. Here is hoping you are able to change all your challenges into opportunities and you have a safe and productive 2013! In this issue, UD Trucks outlines its commitment to leading fuel efficiency, because as we all know fuel forms a major part of the costs involved in operating a truck. The chairman of Ngululu Bulk Carriers tells us how the company became a true BEE transport company and its future plans of expanding its footprint. We have Scania’s MD Steve Wager in the Hot Seat answering our questions. We also speak to some of the OEMs in both the heavy and light commercial vehicle sectors to find out what we can expect from them during the year. At the same time, MAN outlines its optimism about 2013 for both its truck and bus sectors and Scania tells us how the company is ensuring efficient reliable transport solutions for its customers. If you would like to find out how trailers can deliver an optimum performance, carrying loads on the roads then turn to the trailer section and find out what the specialised manufacturers have to say. Optimising transport routing and scheduling is key and crucial to any operation nowadays, especially with the spiralling fuel costs and, in this issue, we look at how operators get the best value out of their fleet. An important aspect of any fleet operation is how operators can track the movements of their valuable cargo 24 hours a day and key players in this field outline tracking solutions available for fleet owners. We take a look at the Durban-Free State-Gauteng corridor, which forms part of government’s 2050 vision and is the backbone of South Africa’s freight transportation network, vital in facilitating economic growth for the country and the Southern African region. We also look at the role of rail in intra-Africa trade and how Transnet Freight Rail is revitalising and reopening branch lines in order to improve access to markets as well as increase overall freight volumes. As always, a varied read – enjoy!
Publisher Elizabeth Shorten Editor Simon Foulds • simon@3smedia.co.za Head of design Frédérick Danton Senior designer Hayley Moore Mendelow Chief sub-editor Claire Nozaïc Sub-editor Patience Gumbo Contributors Barney Curtis, Allen Jorgenson Glen Tancott Production manager Antois-Leigh Botma Production coordinator Jacqueline Modise Distribution manager Nomsa Masina Distribution coordinator Asha Pursotham
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FESARTA COMMENT
by Barney Curtis, chief executive officer, FESARTA
FESARTA and TradeMark Southern Africa (TMSA) have a close working relationship.
F
OR THIS RELATIONSHIP to continue effectively, FESARTA must align its activities with the Comprehensive Tripartite Trade and Transport Facilitation Programme (CTTTFP). This programme has been developed over recent years by the three Regional Economic Communities – COMESA, EAC and SADC – and the two TradeMarks (TMSA and TradeMark East Africa (TMEA). It covers items such as customs documents and procedures, regional customs bond, efficient management of border posts, harmonisation of third-party motor vehicle insurance, harmonisation of load limits and overloading control, standardisation of
vehicle dimensions, harmonisation of road user charges, driver immigration requirements, corridor monitoring and the introduction of self-regulation. The objective of the 2012 Truckers’ Forum, organised by FESARTA and 3S Media, was to identify the leading problems along the corridors in East and Southern Africa, and to workshop the best solutions for them. And, it was important that the outcomes from the forum be integrated into the CTTTFP, so that there could be support for implementing the solutions. Fortunately, the main outcomes, i.e. border delays, load limits and overloading control, arbitrary and excessive charges, road safety
LET YOUR BRAND AND
and self-regulation, could all be linked to the items in the CTTTFP. It has therefore been possible for FESARTA and TMSA to develop a work programme for FESARTA, which will have the objective of implementing the solutions agreed at the forum. The next forum (renamed the Africa Road Transport Forum), will assess what has been achieved since the Truckers’ Forum and workshop a revised way forward. This process, started with the Truckers’ Forum, is a long one. Problems have been on the table for many years, and we would be naïve to think they can all be solved in a few months. But, with the determination and commitment of all the stakeholders, there is sure to be significant progress before the 2013 forum, which will be held on the 17 and 18 April, in Johannesburg.
WITH 3S MEDIA
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COVER STORY
UD TRUCKS
Appropriate technology for Fuel is playing an increasingly vital role in the transport industry, as it forms a major part of the costs involved in operating a truck.
I
T IS BECOMING all the more important for customers to carefully consider the fuel consumption statistics of a vehicle before purchasing a truck,” says Rory Schulz, UD Trucks Southern Africa’s general manager of corporate planning and marketing. “In addition, one also needs to look at aspects like driver training in order to ensure the most efficient operation of a vehicle, careful route planning and optimal load maximisation.” If one makes a case study of some typical rigid vehicle applications with typical annual mileage, operating at an all-up mass of 7, 15 and 26 t respectively, the fuel cost will constitute between 25 and 27% of a fleet owner’s annual operating costs. In a typical truck tractor and interlink application, the fuel constitute around 50 to 56% of the operating cost. Schulz points out that a number of factors come into play when a fleet owner needs to calculate the possible fuel consumption of a truck. “Environmental factors, such as temperature and wind, as well as road surface type and operating conditions,
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always warrant strong consideration when factoring fuel consumption figures,” he says. “The truck’s body type and overall frontal area, the specific tuning of the engine and driveline components, tyre choice, tyre pressure and wheel alignment, as well as the load or all-up operating mass of the vehicle should be on the list of aspects that need constant monitoring and attention.” Over the years, UD Trucks has continually invested in researching the best fuel consumption practices and applications for its local product range. The company therefore believes in only introducing trucks that employ appropriate technology for the demanding road and operating conditions of the African continent. “The quality and hygiene of fuel available in many places in the Southern African region often leaves a lot to be desired,” adds Schulz. “Furthermore, it is imperative that one uses the appropriate fuel for the specific design of the fuel system of any particular vehicle; in other words, ultra-low sulphur diesel or 10 ppm for Euro 4 and upwards. Driver training also plays an increasingly important role, as the correct driving techniques can save operators a lot of money on the long run.”
COVER STORY
Southern Africa Over the years technology has made many advances to increase fuel efficiency. Initially, mechanical advances came by the way of improvement in volumetric efficiency and combustion chamber design and shapes. Fuel measurement and metering, as well as tuning, have also improved the efficiency of trucks through the years. These also include advancements in fuel technology. “Materials and manufacturing processes are enhanced to allow for greater compression ratios and tolerances in order to increase injection pressures. The advent of forward induction systems such as turbocharging also contribute greatly to the advancement in fuel efficiency, while engine cooling improves dramatically as the industry evolves and become more sophisticated,” explains Schulz. However, the most significant improvement came in the form of electronic control units, which has allowed manufacturers to control the exact amount of fuel that is injected at a specific pressure with precision timing. This vital development results in overall combustion efficiency and also helps operators achieve lower emissions, which ultimately leads to improved fuel economy.
Schulz reiterates that there are now engines available that are especially fuel efficient at a particular rev range and engine load. To enable operators to keep the vehicle operating in this ideal range, multispeed transmissions have been introduced and further developments with electronics allow the vehicle to function in an optimum fashion with automated manual transmissions and electronic vehicle management systems. “With these systems of course comes much driver orientation and ongoing training to improve their skills to maximise these benefits. Into the future, emission levels will call for further developments, but alternative fuels to current fossil fuels, such as diesel, are most likely going to be the way to go,” concludes Schulz.
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TWA TW T WA W A | Jan/Feb Jan J Ja an a n //F /Fe Fe b 2013 Fe 20 2 01 13 3
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HOT SEAT
SCANIA
Developed for the most demanding markets In this issue’s hot seat we put Scania’s MD, Steve Wager, on the spot asking him key questions about the company and why fleet operators should be utilising Scania’s range of commercial vehicles.
W
hy should fleet operators consider purchasing Scania trucks for their operations in both South Africa and the Southern African region? Scania trucks have been developed for use in the most demanding markets with high technological content, high performance and outstanding fuel consumption backed by 24/7 service and parts backup.
How is Scania ensuring it not only understands its customers but also the customer’s customers, so you can ensure you have the best transport solutions for them? It is key to understand the customer’s customer – let us call it the industry. Our customers are normally the link between ourselves and the industry. By understanding the whole chain, we can not only improve our customers’ transport efficiency, but the efficiency of the whole chain. All parties will benefitit from it. Around the world, Scania is conducting field testss within different industries to evaluate how to optimise transsport solutions for the future. That includes higher payloads, s, increased efficiency, less environmental impacts, lower er operational costs, etc. These tests are conducted with the e participation of the whole chain so that all parties can ben-efit from the knowledge that we get.
“By understanding the whole chain, we can not only improve our customers’ transport efficiency, but the efficiency of the whole chain” What makes Scania’s trucks different from its competitors? Our trucks are unique but our outstanding transport solutions package makes the real difference. These include: 1. Driver comfort and safety – Our cabs offer a high degree of safety features to protect the driver in case off an accident and conforms to the Swedish crash test. Comfortable sleeper bunks designed by a leading mattress manufacturer ensure a good night’s rest. 2. In-house insurance – As part of our one-stop-shop policyy we offer in-house insurance to our customers.
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3. In-house financing – Scania Finance, our in-house finance company, offers financial packages to suit customer needs and speed up transactions. 4. Wholly owned dealer network – Our dealer network is wholly owned giving us direct control over sales, services, pricing, deliveries and customers. 5. Driver academy – Our driver academy offers driver training packages to ensure trucks are operated within design parameters ensuring best returns on investment for the customer. 6. Operating economy – When operated within legal limits like loads and speed driven by a trained driver, our trucks deliver outstanding results. 7. A 24/7 call centre – Our call centre is manned by top technicians and services sub-Saharan Africa to attend to unlikely breakdowns. Scania parts are available from our dealer network with back up from our central parts warehouse.
HOT SEAT
How important is continuous driver training by Scania to those fleet owners who have purchased and are purchasing your vehicles, especially with the technology now available in your trucks? Very important! The role the driver plays is critical to the success of any transport company. The better trained the driver is, the more economical the operation of the fleet will be. But it is not only economic factors such as fuel consumption, lower maintenance and residual values that are positively affected by driver training, the range is much wider than that. Safety, environmental factors, improved employee satisfaction and retention, the list continues… Our customers are buying a premium product at a premium price and they expect a premium return on their investment. Driver training is the key to utilising the vehicle to its full potential.
Looking at the economic and political landscape in South Africa, are you optimistic about the future of Scania and Southern Africa, and why? Yes I am. South Africa has its internal challenges, but the majority of the problems that we see today are caused by external factors, very much connected to the downturn in the global economy. Looking
at the huge number of people living here, consuming goods, needing transport, the possibilities for Scania as a provider of transport solutions is great. There is a clear connection between GDP and the need of transport. When the world moves out of this recession, we will have a very positive growth in our industry.
“Our customers are buying a premium product at a premium price and they expect a premium return on their investment”
Bringing your wealth of experience from having worked in both the UK and Europe, how is the South African truck market faring compared to the UK and European markets? The European transport industry is generally far more mature than in Southern Africa, but nevertheless customers’ demands from their transport solution providers are largely the same. Operators are seeking maximum uptime to support the ever-increasing demands of their customers and of course they are looking for the lowest possible total cost of ownership. Excellent customer service and a wide range of service offerings are thus essential ingredients for a successful operation here. Scania is thus able, from its European market experience, to offer extensive transport solutions including truck rental, repair and maintenance contracts, financing and insurance, workshop takeovers – the list is almost endless.
TWA | Jan/Feb 2013
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FESARTA NEWS SUB-SAHARAN AFRICA
EAST AFRICA
New software platform developed by the region saves time and money THE EAST AFRICAN COMMUNITY in partnership with the United States Agency for International Development has launched the Revenue Authorities Digital Data Exchange platform in Tanzania. The Revenue Digital Data Exchange is a software platform for customs and transit data exchange, management and reporting. It allows for near realtime transmission of customs documentation to authorised public and private sector users at key border posts and cities across the five countries within the East African Community (EAC) – Burundi, Kenya, Rwanda, Tanzania and Uganda. The software saves time and money by shortening cargo processing times and reducing the number of officials needed to process cargo as some of the largest nontariff barriers to trade and cost to businesses in East Africa are delays at border crossings.
Poor maintenance “threatens roads in sub-Saharan Africa” ROAD TRANSPORT IS ONE of the focal
Efficiencies at borders are now achieved through advanced notification of shipments and completion of documentation before goods arrive. Advanced completion of customs declarations can save up to 12 hours in transit time at border crossings. The Revenue Digital Data Exchange is owned, operated and maintained by the revenue authorities of East Africa and was developed by the EAC along with the national revenue authorities with support from the USAID East Africa-funded Competitiveness and Trade Expansion (COMPETE) programme.
sectors for the European Development Fund cooperation strategy with most sub-Saharan African countries. Financially, it is by far the most important cooperation sector, with approximately €7.4 billion (R86.61 billion) in European Development Fund (EDF) commitments made in this region between 1995 and 2011. However, improper road maintenance and vehicle overloading is putting the sustainability of sub-Saharan road network into danger. In sub-Saharan Africa, roads are the dominant mode of freight transport, accounting for more than 80% of total movements of goods and services and transport needs are growing rapidly.
SOUTHERN AFRICA
Rail link to streamline Southern African trade FIVE SOUTHERN AFRICAN COUNTRIES plan to coordinate their rail services to bolster trade through Africa’s largest port in Durban. The deal will do away with bilateral agreements, which complicate the export of copper, grain and containers across five countries through South Africa. “The main objective is to align the five railway lines towards a unified railway system on the North-South Corridor by establishing a Joint Operating Centre in Bulawayo,” says Nyameka Madikizela, head of international business at Transnet Freight Rail.
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Railway companies in the Democratic Republic of the Congo and landlocked Zambia, Zimbabwe and Botswana will streamline their existing rail infrastructure to facilitate transport to South Africa’s Indian Ocean port. The lack of a regional deal causes many delays in exports and imports. Increased outside trade with the continent has seen a greater need for intra-regional cooperation to get important resources across vast areas to ocean ports. “The opportunities exist in copper, chrome ore, etc., where the mines need some confidence in rail and, by cooperating through this agreement, we can develop a strategy that will provide capacity immediately,” explains Madikizela. The deal will see rail take over volumes that the region’s roads mostly carry at the moment, she adds. It will also bolster Durban’s competitiveness against ports in Tanzania on the Indian Ocean and Angola on the Atlantic. The rail centre, run from Zimbabwe, is due to launch this year.
The aid-recipient countries visited by the European Union (EU) do not do enough to ensure the sustainability of road infrastructure. In all partner countries visited, roads are affected to varying degrees by premature deterioration. Most of these countries have adopted institutional reforms, notably entailing the creation of road funds and road agencies, and made significant progress on road maintenance. However, many challenges remain to be addressed in all of them to ensure appropriate maintenance. Although spending on road maintenance has increased over time it remains insufficient to cover the needs. “In Europe, we are used to several options for our transport. In sub-Saharan Africa, if it is a question of transport, that means roads. Unless the EU Commission and its partners in sub-Saharan Africa start taking sustainability of the roads very seriously, they will be in danger of losing what we’ve built together,” says Szabolcs Fazakas, the Economic Commission for Africa member responsible for the report. “They [African leaders] need to take responsibility for enforcing load limits and to maintain the roads properly.”
FESARTA NEWS EAST AFRICA
EAST AFRICA
Transport ministers discuss Isaka-KigaliMusongati rail project study THE THREE EAST AFRICA GOVERNMENTS of Tanzania, Rwanda and Burundi have reiterated their political will and commitment to hasten the proposed Isaka-Kigali-Musongati construction project of a railway line, which has been in discussion for 10 years without formal implementation. Transport ministers of the three countries: Dr Harrison Mwakyembe (Tanzania), Alexis Nzahabwanimana (Rwanda) and engineer Moise Bucumi (Burundi) have also agreed to sign a Memorandum of Understanding, binding the countries to results of studies and agreements on how to go about implementing the project.
The findings of the completed phase one feasibility studies were conducted by DB International of Germany in 2009 and Burlington northern Santa Fe (BNSF) of the United States. The two firms then considered the project to be economically viable and financially feasible. Current project coordinator Josephine Uweneza of Rwanda, in her presentation to members of a Joint Technical Monitoring Committee of the three countries, highlighted this study in her report adding that a detailed study would be completed by the end of March 2013.
EAST AFRICA
The highest amount of bribes from transporters and drivers along the transport routes A SURVEY BY TRANSPARENCY INTERNATIONAL KENYA and TradeMark East Africa has revealed that regulatory authorities in East Africa demand the highest amount of bribes from transporters and drivers along the transport corridors. According to the report, titled Bribery as a non-tariff barrier to trade: a case study of East African trade corridors, Tanzania’s regulatory authorities rank worst at US$12.64 (R110.76) followed by Kenya at US$6.72, then Uganda at US$3.67, while Rwanda ranked fourth at US$0.679 with Burundi being the lowest at US$0.293. The survey, conducted in collaboration with Transparency International chapters in Burundi, Rwanda, Uganda and the Transparency forum in Tanzania,
further indicates that bribery costs in Tanzania per year consisted of about 18.6% of the value of goods transported. Lisa Karanja, director of Private Sector and Civil Society, from TradeMark East Africa (TMEA), which funded the study, says: “Regional integration is gaining pace but existence of non-tariff barriers continues to be a deterrent in the full implementation of the various protocols. TMEA commissioned this study with a view to enhance the advocacy for the elimination of non-tariff barriers. “We expect a comprehensive dialogue between state and non-state actors to address the key issue highlighted by this report. “A resolution of the identified issue will lead to a more competitive business environment that will result in increased trade and ultimately prosperity for East Africans.”
Free trade has a way to go as nontariff barriers push up cost of doing business in the region BUSINESSES IN EAST AFRICA will have to wait longer to reap the fruits of free trade, thanks to non-tariff barriers. According to a report by the East African Community (EAC) Secretariat, rather than doing away with non-tariff barriers (NTBs) by December 2012 in accordance with the EAC plans, some countries have even introduced fresh ones – about 10 – while 35 remain unresolved. Only 36 have been resolved. The Secretariat also found that differences over elimination of the barriers had deepened, denying the region larger markets, economies of scale and promotion of local, regional, and global trade — the benefits envisaged with free trade among the nations. This means businesses will have to continue incurring huge costs arising from the NTBs – mainly weighbridges, roadblocks, poor infrastructure, unnecessary delays at border posts and lack of harmonised import and export standards, procedures and documentation. The sad state of affairs is blamed on the absence of a legally binding framework that has left businesses at the mercy of individual countries. A draft law meant to punish countries that fail to implement agreed upon mechanisms to eliminate trade barriers was submitted to the regional parliament in November 2012. EAC secretary-general Dr Richard Sezibera says a legal framework has been developed and is awaiting comments from member states.
TWA | Jan/Feb 2013
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NEWS DESK RICHARDS BAY TERMINAL
Equipment boost still tracking according to plan A R140 MILLION general bulk shiploader is the latest addition in Transnet Port Terminal’s R33 billion Market Demand Strategy investment programme. Custom-built to complement the terminal’s The red ship loader pictured in the Port of operational envelope, the loader was deRichards Bay after its signed in Austria and built in China; however, arrival on 16 January South African engineering company Sandvik has managed its entire procurement. Its capacity is a guaranteed 2 500 tph at a bulk density of 1.9 t/m3. The linear travelling loader will be suitable for all export commodities the terminal handles including coal, magnetite, chrome and chloride. Just over 70% of the terminal’s total commercial trade is export. The addition of equipment is aimed at the Market Demand Strategy’s promise of facilitating unconstrained growth, unlocking demand and creating world-class port operations through improved efficiencies. A skills transfer opportunity has also been created through Sandvik where Transnet Celebrating the arrival of the Port Terminal operators and the Richards Bay Terminal’s new technical team will be trained R140 million ship loader were for sustainable operations. The (from left): chief maintenance officer, Shane Narainsamy; project pre-assembled loader will be ofmanagers Alec Schemel and Kris floaded and installed upon arrival Naidoo; terminal manager, Victor to undergo commissioning. Mkhize and general manager: The machine is scheduled to be Capital Projects and Maintenance, Logan Naidoo fully operational by April 2013.
MOZAMBIQUE
MCLI AGM Corridor update event THE MAPUTO CORRIDOR LOGISTICS Initiative is hosting its Corridor Update event on 21 February 2013 at the Kambaku Golf Club in Komatipoort, which overlooks the confluence of the Nkomati and Crocodile Rivers with breathtaking views of the Kruger National Park. Maputo Corridor Logistics Initiative (MCLI) members and corridor stakeholders across the logistics supply chain will attend the meeting, which takes place during a gala dinner in the evening. There will be a short programme of AGM proceedings and a report from the two MCLI chairmen. The Corridor Update will then focus on progress on the 24-hour one-stop border post at Lebombo/Ressano Garcia with the keynote address being shared by the South African Revenue Service and Alfandegas Moçambique. In addition, Transnet Freight Rail, Swaziland Railway and CFM will give an update on developments regarding the rail service to the Corridor and the
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SOUTH AFRICA
ATNS hosts Benin minister of transport A BENIN GOVERNMENT DELEGATION led by its minister of Public Works and Transport, Lambert Koty, visited the Air Traffic and Navigation Services’ Aviation Training Academy in Bonaero Park, near the OR Tambo International Airport. “We are very impressed at the level of competency, knowledge and skill in this organisation. The same can also be said with regards to infrastructure and technology deployment. We should have been here some time ago” said Koty. The Air Traffic and Navigation Services (ATNS) board chairman, Mpho Mamashela, addressing the Benin delegation said: “Air transport is a major contributor to global economic prosperity. Aviation provides the only rapid worldwide transportation network, which makes it essential for global business and tourism. It plays a vital role in facilitating economic growth. “Aviation safety is important for international trade and economic development. Our work to promote safety through continuous training also strengthens the global economy, because the two are deeply intertwined. South Africa’s economic future is directly linked to reaching beyond our borders for new trade and investment opportunities. Our aim is to deepen ties with large, dynamic and high-growth markets around the continent.” Rushj Lehutso, ATNS executive: Commercial Services, added: “The global aviation supply chain’s link must be strong for the entire system to function. ATNS is proud to have initiatives in place, aimed at working closely with Benin’s aviation department to maintain and enhance the integrity of the global aviation system. Together we will improve the conditions for cross-border trade, economic growth and long-term prosperity for generations to come.”
new services into Maputo via the Goba line in Swaziland. TransAfrica Concessions, the N4 road concessionaire, will also provide insight into the developments and upgrades planned on the Johannesburg to Maputo route. The Maputo Port Development Company will also present an update on the port’s growth trajectory and its investment roll-out in line with its 2033 master plan. A bus tour to the Port of Maputo will take place on 22 February before returning to Johannesburg late that same evening. Before the gala evening on 21 February, a Golf Day has been planned with golfers taking to the field in a Four Ball Alliance (2 Scores to Count) competition. This presents a wonderful networking opportunity while playing a round of golf on one of the Lowveld’s beautiful golf courses. For non golfers a number of local excursions including game drives into the Kruger, a luxury day spa experience, aerial game viewing and the possibility of visiting a rhino and rare antelope breeding programme are being planned. For more information about the Corridor Update please contact admin@mcli. co.za or call +27 (0)13 755 6025.
NEWS DESK SOUTH AFRICA
Self-regulation working well for SA transport industry THE SELF-REGULATION SYSTEM, as stipulated in the Road Transport Management System (RTMS), is proving to be a very effective tool for South African truck and bus operators in managing fleets efficiently and cost-effectively, with many case studies to back up the success of the roll-out. “The RTMS, which has been in operation since 2003 and is finding growing support among fleet operators, continues to show outstanding results since implementation and supports the Department of Transport’s National Road Freight Strategy as the fourth pillar in the action plans,” comments the chairman of the RTMS national committee, Adrian van Tonder of Barloworld Logistics. “Currently there are 2 674 trucks and 395 buses (the Buscor fleet) from 68 company depots carrying the RTMS accreditation logo, with a quantum leap in participation having occurred in the past 24 months,” adds Van Tonder. RTMS is an industry-led, government supported, voluntary selfregulation scheme that encourages consignees and road transport operators to implement a management system – a set of standards – that demonstrates compliance with the Road Traffic Regulations. It also contributes to preserving the road infrastructure, improving road safety, ensuring driver health and wellness as well as improving productivity. Hino, one of South Africa’s leading truck manufacturers, is giving its full support to assisting with the roll-out of RTMS. Hino uses its nationwide dealer network as an important catalyst to spread the good news and benefits of using the system to its customers and then assisting them with the implementation. “We at Hino see the RTMS as a very important
initiative in creating responsible truck operators who show concern for the roads and environment while focusing strongly on fuel saving,” says Hino South Africa’s vice president, Dr Casper Kruger. “Our support for the RTMS has already extended to our dealers and we are sponsoring a series of successful and well-attended information-sharing sessions throughout the country to promote this programme. “We then encourage our dealers to keep up the momentum by following up with the transport operators who are not on the system to take up the challenge and assist them in developing a strategy to meet all the requirements,” adds Kruger. “The development of the RTMS flowed over from initiatives by the timber industry in KwaZulu-Natal at the beginning of the 21st century to combat overloading, which causes damage to roads, while also contributing to cutting the number of accidents involving trucks,” explains Van Tonder. “The KwaZulu-Natal project was known as LAP (the Load Accreditation Programme) and was also self-regulatory. This concept was expanded with the addition of driver health, compliance with road traffic regulations and all aspects of road safety to establish the basis for RTMS standards.” Driving forces in those early days included Paul Nordegen, Oliver Naidoo and Andrew Kriek, and they formed a steering committee in 2006 to give momentum to the initiative. There is now a more formalised RTMS national committee made up of representatives of a host of stakeholder organisations and associations that is now driving the project forward. Current chairman, Van Tonder, came aboard in 2009 and is extremely enthusiastic about this initiative.
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PROFILE
SUCCESSFUL BLACK EMPOWERMENT TRANSPORT COMPANY
Established in SA and expanding into Africa Ngululu Bulk Carriers has a rich history dating back to the 1980s. Since then, the company has grown to become the dominant transporter in the ferrochrome sector and an extremely successful BEE owned and operated company. It is a shining example of how historically disadvantaged persons moved from a minority shareholding to take control between 2003 and 2009.
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HRIS LUVHANI, CHAIRMAN of Ngululu Bulk Carriers, says prior to 2003 his investment company had no interest in expanding into the transport and logistics sector.
BEE partner wanted In the late 1990s, Lukas Potgieter, who founded the company in the 1980s, was under pressure from his mining clients to become more BEE compliant as per the mining charter. “Prior to our introduction, Potgieter had tried a few empowerment models, which were not successful, and he almost got his fingers burnt in the process of trying to find the right BEE partner. It was, however, through an acquaintance that I was introduced to him and his company, Lukas Potgieter Vervoer. “When I first met Potgieter in 2003, I told him that I did not know anything about the transport industry and could not buy a 26% stake in order for him to be compliant according to the mining BEE requirements and therefore appease his clients. However, I told him that I would be interested in taking an initial 10% investment stake in the company and if he was serious about having a true black empowerment partner actively involved in his business, as opposed to simple window dressing, then I would increase my investment.” Another condition Luvhani had when purchasing the 10% was that should he want to increase his stake in the company both parties had to agree how much he could increase his stake to. When Luvhani’s company purchased the first 10% stake it was therefore agreed that if Potgieter was genuine and wanted a proper empowerment partner Luvhani would then take a controlling stake in the company within five years. The deal was signed in December 2003 and was to take effect in April 2004. By the end of July 2004, both Luvhani
and the current CEO Freddy Sinthumule had literally fallen in love with the company and decided to increase their stake to 26%. By 2008, Luvhani wanted to take control of the company, allowing the owner to retire. In 2009, he purchased a further 25% enabling Ngululu group to take control. By the end of that year, a share buyback of Potgieter’s remaining 9% saw Ngululu increasing its stake to 56% of the issued shares in the company.
Name change It was at this time that Luvhani realised they had to look at changing the name of the company to reflect the owners, at the same time sending out a strong message to the market that there had indeed been a serious empowerment deal within Lukas Potgieter Vervoer. “Some of our major clients had been pushing for a name change. I am a sensitive man and knowing the dynamics of the industry I did not want to dent Potgieter’s image because he had spent many years building up and establishing a credible company. But one day after we had seen a client, Potgieter turned round and said that “some major clients are complaining about the company’s name and it is time to change the name to reposition the company in the prevailing dispensation”. Following Lukas Potgieter’s retirement in May 2009, the company was rebranded as Ngululu Bulk Carriers and rebranding of the assets was completed by the end of December in the same year.
Successful operations “I am extremely proud of where the company stands
By the end of July 2004, both Luvhani and the current CEO Freddy Sinthumule had literally fallen in love with the company and decided to increase their stake to 26% TWA | Jan/Feb 2013
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