Motor Transport 12 November 2018

Sharp ■ Informed ■ Challenging

NEWS INSIDE Urban delivery

Highlights from Freight in the City Expo in London p3

12.11.18

“THE QUALITY OF WORK IS EXCELLENT, AND THAT’S INVALUABLE TO US.” Michael Pedersen, Chairman - Pederson Contracting Services Ltd.

Challenging times

Connect experiences a calamitous year of losses p4

On the gas

IVECO’s Stralis NP is a turning point for gas

p6

OPERATORS IN THIS ISSUE Abbey Logistics ....................................p4 Connect Group ......................................p4 Howard Tenens ...................................p20 John Lewis Partnership .......................p15 Laser Transport ....................................p4 McBurney Transport ...........................p18 Tuffnells ...............................................p4 Whirlpool Corporation ........................p22

Wincanton boss says 3PL not interested in signing deals it might come to regret

‘No margin – no way’

By Chris Druce

The boss of Wincanton says the 3PL has seen signs of the market hardening around price, as an increasing number of clients realise that the cheapest deal is not always the best.

Speaking after the publication of its half year results, Wincanton CEO Adrian Coleman said the 3PL had sacrificed some top line revenue where the pricing of a contract hadn’t been right.

“It’s profit that really matters,” he said. “If you sign something low margin today, it will be no margin or even negative in two or three years’ time. We’re making sure that we don’t sign anything we’ll regret in 12 months’ time.”

Coleman said that while it was his responsibility to expand the Wincanton business, it had to be the right sort of growth. “I think in the last one or two years customers have moved away from simply

being very keen on price.

“There appears to be an understanding for many now that you need to pay more to guarantee a level of service.

Ultimately you’ll lose out on revenue if your provider can’t deliver, so there is definitely a realisation I feel that transport resource doesn’t just grow on trees,” he said.

Coleman singled out Wincanton’s deal to provide

warehousing and transport for the 10-year Hinkley Point nuclear power station build as a highlight in the period.

Wincanton is providing warehousing and logistics for the mechanical and engineering flow the project requires, with the demands similar to its defence work, which has included an aircraft carrier build in Scotland.

“We’re under way [on Hinkley] and it’s led to construction companies seeing us there and wanting our help on projects. We’re excited about its potential to unlock other work for us such as projects like HS2, Crossrail 2 and the Thames Tideway.”

Wincanton will pay an interim dividend of 3.6p per share.

HALF-YEAR RESULTS TO 30 SEPTEMBER 2018

Turnover £582m (2017: £581m) Underlying operating profit £27m (2017: £25.7m) Pre-tax profit £30.1m (2017: £20.3m)* Net debt £24.2m (2017: £43.5m) * includes a £6m exceptional gain of the sale of a Corby freehold to Iron Mountain

Roadshow will focus on last-mile delivery vehicle trials Last-mile operations and home deliveries will be the focus at the next TfL LoCITY roadshow, on 20 November.

Operators at the roadshow will tell their peers how their trials of the latest low- and zero-emission commercial vehicle technology have gone.

Parcel firm Hermes, headline partner for the event, will share its experience of electric and gas-powered fleet vehicles.

Freight in the City p3

MTR_121118_001.indd 1

There will also be speakers from Sky, Royal Mail, Lawsons and Zedify, which are operating alternatively fuelled delivery vehicles in their fleets.

This free-to-attend, half-day event is the sixth LoCITY roadshow hosted by TfL and run

by MT owner DVV Media. It takes place at CEME Conference Centre, Rainham.

■ Find out more and register at locityroadshows.co.uk.

Focus: Business barometer p10

Viewpoint p12

Lubricants p15

■

But that’s only half the story Page 5

Motor Transport Awards Winners p18-23

08/11/2018 18:32:38

Documents for driving in the EU are changing If you are a UK haulier driving in the EU, you’ll need new paperwork from 29th March 2019. Make sure you get yours in time to stay on the road.

Get prepared and register for alerts.

Visit: GOV.UK/EUEXITDRIVING

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08/11/2018 09:23:36

News

motortransport.co.uk

Direct vision, Brexit, retrofit kit costs and a warehousing shortage take centre stage

Road to zero is long

By Chris Druce

Retrofit kits are unlikely to meet the needs of the majority of hauliers facing the rapid advance of emission controls across the UK’s towns and cities, delegates at last week’s (6 November) Freight in the City Expo were told.

Speaking during the first session, Emission control, Natalie Chapman, head of urban policy at the FTA, said talks with firms working to accredit retrofit systems for Euro-4 and Euro-5 HGVs indicated operators faced a £15,000 to £20,000 bill per truck.

“That suggests retrofit is likely to be more feasible for operators with specialist vehi-

cles rather than those running standard HGVs. At the same time we have seen the residual value of many Euro-5 trucks plummet due to clean air zones,” she said.

However, responding to the claim that retrofit is proven for buses but not HGVs yet, Andy Eastlake, MD at the Low Carbon Vehicle Partnership, told delegates that there were now two accredited systems available, pointing to Veolia’s successful trial in London’s Westminster with two Euro-5 refuse trucks and more to come.

Eastlake said that retrofitting was one option available to operators that could not

realistically move their entire fleet to Euro-6 overnight, and an important one.

“The transition will take time, so the availability of retrofit is critical.

“But if you are going to retrofit, make sure it’s accredited [by the Clean Vehicle Retrof it Accreditation Scheme]. If it’s not accredited it’s not going to get you into a clean air zone without a penalty,” he warned.

However, delegates were left in no doubt that clean air and emission zones are not going away, with London, Glasgow, Leeds, Aberdeen and Southampton all set to ratchet up or introduce curbs within

Get warehousing sorted pre-Brexit Brexit has amplified the shortage of warehousing space in the UK, delegates were told at the expo.

Kevin Mofid, director of research at Savills, said: “Property is the forgotten part of the supply chain. Brexit is amplifying these trends. At a national level the vacancy rate for warehousing is 6%; in London that falls to 3%.

Amazon took 27% of all available warehousing space in 2016. You’ve got all this structural change in the retail world happening, and then Brexit is coming along to amplify those trends.”

He added: “Anyone looking for warehousing space as a result of Brexit should be thinking about it now as there isn’t a lot of space to go around.”

Mofid pointed to the residential property market as an example of what this trend could do to commercial rates for warehousing property. “All of the political pressure is about delivering homes,” he said. “For example, in New York and San Francisco there is 1.5% vacancy rates, and rents have gone up 40%. This is coming to London. This is going to be needed to be factored in for planning. It is effectively a landlord’s market.”

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the next year to 18 months.

Dr Bob Moran, deputy director, head of environment strategy at the DfT, underlined this in a discussion regarding the government’s ‘Road to zero’

strategy, which includes the target of a 15% reduction in HGV greenhouse gas emissions by 2025. “Clean freight strategy is difficult… but we’ve got to solve it.”

I CAN SEE CLEARLY NOW: TfL will hold its third and final public consultation for its Direct Vision Standard (DVS) in January 2019. Speaking in a slot at the Knowledge Zone at the expo, Alina Tuerk, delivery planning manager at TfL, told delegates the consultation would take place early next year, with a likely start date of 8 January. A component of the consultation will be how best to provide hauliers with information on qualifying equipment for the proposed Safe System, essentially the indirect aids such as cameras and sensors, required to keep trucks that TfL deems to have poorer visibility on the road past 2020.

The consultation will also cover how the DVS permits, which will be issued free of charge by TfL from October 2019, will be administered – an online, paperless system is mooted. Tuerk confirmed to MT that the DVS is set to be implemented on 26 October 2020, which will tie into the extension of the Low Emission Zone to cover HGVs London-wide (mandating Euro-6).

DAF wants government backing for drop-in fuels DAF Trucks used the expo to raise awareness of the environmental benefits of paraffinic, drop-in fuels available today. These include gas-toliquid (GTL) and hydrotreated vegetable oil (HVO).

DAF said the fuels contain almost none of the impurities in crude oil, such as sulphur, aromatics and nitrogen and have delivered air quality benefits in trials with customers through reduced NOx emissions. HVO also has the potential to reduce well-to-wheel CO2 emissions by up to 90%.

DAF Trucks marketing manager Phil Moon (right) said:

“We’re keen to open people’s minds to the idea of drop-in fuels because there is a lack of awareness that they are available and they can be used today.

Being drop-ins you can start running a truck tomorrow without any modifications or change to service intervals and no warranty implications. You have an easy solution to improving [road transport’s] effect on the environment.”

Moon would like to see the government help stimulate the market for drop-in fuels, perhaps by providing a fuel duty differential in the same way it is applied to natural gas.

MotorTransport 3

08/11/2018 17:58:29

News

motortransport.co.uk

BAKE OFF: Abbey Logistics has been awarded a contract with Hovis to provide bulk flour distribution to its bakeries in the Midlands and the south. Abbey Logistics will invest significantly in new equipment to bolster Hovis’s existing fleet and will support its new customer with resource from its wider nationwide bulk powder tanker fleet. The operator will focus on bulk flour delivery from Hovis’s mill in Wellingborough, Northamptonshire.

Staff supporting Hovis in the Midlands and the south will transfer to Abbey when the contract begins in January.

The deal does not affect CEVA Logistics’ work with Hovis, which sees the 3PL providing distribution of packed goods for the baker.

Operational inconsistency and aborted integration hammer group’s annual profit

Connect concedes to a ‘challenging year ‘

By Chris Druce

Connect Group’s annual profit has collapsed by more than 200% after a calamitous period, which saw its one-time star-performer Tuffnells lose its way and attempts to restructure the business hit the wall.

Announcing its annual results for the year to 31 August 2018, the business, which also owns Smiths News and recently disposed of its Pass My Parcel network, made a pre-tax loss of £35.5m (2017: profit of £34.2m). Annual turnover was 3.8% lower at £1.5bn (2017: £1.6bn).

In what it described as “a significantly challenging year”, Connect said weaker trading in Tuffnells and Smiths News (including losses in Pass My Parcel) was compounded by “operational inconsistency and shortfalls against efficiency targets”.

In July 2017, Connect restructured its leadership and operations “in pursuit of a more integrated business model”. The group said that while progress was made in centralising support services, it became clear that the same efficiencies could not be achieved in sales and market4 MotorTransport MTR_121118_004.indd 4

ing and at an operating level.

It conceded that “the move to integrate into a single structure weakened operational performance and affected internal accountability and controls.

“A detailed review of the group’s networks concluded that opportunities for combining physical operations of Tuffnells with Smiths News are limited, giving further impetus to a return to more focused management,” it added.

Operationally, Connect has ceased integration activity across its two main networks.

“We have re-established dedi-

cated management teams and leadership for Smiths News and Tuffnells, returning accountability for revenue and costs to the individual businesses, while supporting them with the newly integrated central services,” it said.

As part of the failed integration, Connect announced last year that Tuffnells MD Chris Ward was to leave, a departure that was followed soon after by the first warnings that the mixed and irregular freight specialist was not performing under the new regime.

Connect recorded a goodwill impairment of £46.1m against Tuffnells in its latest

accounts, conceding that its restructure caused operational instability leading to a significant shortfall of drivers, high staff turnover and an inability to handle peak volumes.

Tuffnells made an operating loss of £57.7m in the period compared with a £4.3m profit a year ago. On an adjusted basis it reported an operating loss of £5m compared with an adjusted operating profit of £12m in 2017. Turnover fell 4.4% to £175.2m (2017: £183.2m) with “sales and volumes performance in the second half of the year materially behind expectations”.

Connect Group chairman Gary Kennedy said: “A year of significant challenge exposed weaknesses in our strategy and its execution, with a consequent effect on results. While it is disappointing not to succeed, we have taken action to address underperformance and respond to the lessons learned.

“I am confident that under the new leadership of Jos Opdeweegh, and a return to more focused operations, we can re-energise the business, restoring stability and confidence.”

Laser Transport chairman dies Laser Transport International chairman John Smith, 83, has died after a short battle with cancer.

Smith set up Laser Transport International in Dover in 1973. In addition to customs clearance, the company had interests in the automotive sector and rapidly expanded by moving to larger premises, first in Dover and latterly at Lympne, near Folkestone, which is now the firm’s head office.

During this period Smith started a small groupage operation that eventually became the core business of the company.

Laser Transport International paid tribute to its former boss in statement: “John was a respected figure in the industry, regarded as a leader and gentleman. He always demonstrated an enthusiastic hands-on interest in the business and was a firm believer in the value of independent companies in today’s global market.”

Smith (pictured) is survived by daughter Amanda and grandson Jamie.

12.11.18

08/11/2018 14:40:55

We have 30 trucks on contracts and get most servicing done overnight to maximise uptime. The work is carried out by Scaniatrained technicians using specialist tools and is completed quickly and right first time. The quality of work is excellent, and that’s invaluable to us – we wouldn’t go anywhere else.

“

Michael Pedersen, Chairman Pederson Contracting Services Ltd.

But that’s only half the story Over the last two years, Scania technicians have completed over 6,500 days of training. Keeping them up to date with the latest technological advancements, and ensuring they are the Scania experts.

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08/11/2018 09:25:45

News

motortransport.co.uk

Government’s duty pledge means economic as well as environmental case proven as IVECO records savings

Stralis ‘turning point’ for gas

By Steve Hobson

Switching from diesel to natural gas will produce up to a 10% saving in CO2 emissions for a heavy truck running on motorways, according to trials IVECO was involved in at Millbrook.

Speaking at the official UK launch of the Stralis NP 460hp 6x2 Cursor 13-powered tractor, IVECO MD for UK and Ireland Stuart Webster said the new truck marked a turning point for gas vehicles in the UK, as 91% of tractor units registered in the UK are 6x2.

While Volvo is testing its gas/diesel 6x2 unit, IVECO is first to market and expects the 6x2 to sell substantially more than the 200 gas 4x2 tractors it has put on UK roads so far.

IVECO alternative fuels director Martin Flach claimed that natural gas trucks produce 90% less NO2 and 99% fewer particulates than Euro-6 diesel and that moving from conventional diesel to biomethane would cut CO2 emissions by 95%. The NP 460 can be switched to a quiet mode to achieve noise levels of 71dB(A) for night-time deliveries.

While some larger operators will switch to gas for environmental reasons, Flach said the economic case had also been proven, especially now

the government had pledged to maintain the duty differential on natural gas below diesel until at least 2032.

This means the next one, and possibly two, buying cycles for new gas trucks would see a strong pay-back, due to the lower cost of fuel.

This is despite gas trucks costing £30,000 to £35,000 more than their diesel equivalents, a cost gap that will narrow as volumes increase. Half this extra cost is in the special twin liquefied natural gas (LNG) tanks used on the 6x2 to increase the range to more than 750km, significantly more than IVECO’s gas-powered competitors Volvo and Scania.

Flach said IVECO’s stoichiometric combustion system was designed to operate at the chemically correct air/ fuel ratio and used anti-knock software to ensure smooth running at all engine speeds.

Maintenance intervals

Maintenance intervals for the NP range tractors are currently 90,000km but IVECO is hoping to extend this to 120,000km when a gas-specific engine oil becomes available. Spark plugs should last up to 150,000km but IVECO advises changing them at 120,000km.

CONSUMPTION AND COST Fuel consumption/100km 28.5

Diesel Euro-6 Stoichiometric + EGR

28.4

HPDI

21.0

Stoichiometric NP

2.1

1.8

1.8

24.5 0

2

4

6

10

8

12

14

16

18

22 24 26 28 20 ■ LNG ■ BOG ■ Diesel ■ AdBlue

Fuel cost (£/100km) Stoichiometric + EGR

21.0

HPDI

15.5

Stoichiometric NP

1.1 1.4 0.3

18.1 0

2

4

6

8

10

Every one of IVECO’s 89 UK service points will have a ‘gas champion’ and service levels on repair, maintenance, parts and breakdowns will be exactly the same for gas and diesel trucks.

IVECO is working closely with gas refuelling station operators and estimates there will be 400 open by the end of 2018 and a further 100 by the end of next year. The network so far is concentrated around main arterial routes such as the M1, M5, M6 and A1 but is gradually spreading across the UK. There is now one gas station in Scotland and small Glasgow haulier Gilmour Brothers has two gas IVECO trucks on the road.

The launch of the 6x2 means that IVECO can now offer gas vehicles from 3.5 tonnes to 44 tonnes, and it will launch a 460hp gas Stralis X-WAY construction truck early in 2019. It is also considering increasing the power output of the 13-litre gas engine to over 500hp for operators requiring higher horsepower tractors.

While it is investigating other fuels such as electric and hydrogen it believes natural gas will remain the only viable alternative to diesel power for heavy trucks for the foreseeable future. Its commitment to future fuels was demonstrated at the last IAA show in

-12% -14%

12

14

16

18

22 24 26 28 20 ■ LNG ■ BOG ■ Diesel ■ AdBlue

Hannover when its stand featured only electric, gas and hydrogen vehicles.

Ocado fleet services manager Graham Thomas is a convert to gas, and has been running five IVECO Stralis 4x2 tractors since August. He has a further 24 on order for his Hatfield depot where they will haul 5m-high double-deck trailers at 32-tonne GVW. He said moving from Euro-6 diesel to natural gas was “morally the right thing to do” and described how his first sight of the Stralis NP 400 in 2017 was a “game changer”.

“IVECO was streets ahead on gas so we started our journey,” he said.

“We got a demonstrator straight away to get our drivers’ reaction as we were an all-Mercedes-Benz fleet at the time.”

He said the drivers loved the gas trucks, mainly because they were as easy to drive as diesels – despite having 30hp less – and much quieter.

Thomas is running on compressed natural gas because the 600km range it provides is adequate for most of his routes.

Using Ocado’s own fuel consumption and cost figures he calculated he was saving £13,500 in running costs every year on each truck.

“It is a no-brainer,” Thomas said.

Derby residents and businesses say no to clean air zone proposals Derby City Council has rejected plans for a clean air zone (CAZ) after residents and businesses voted overwhelmingly for a traffic management system to cut emission levels in the city.

Almost three-quarters (73.6%) of respondents to the city’s public consultation voted for a traffic management system, compared with 27.5% for a charging zone within Derby’s inner ring road, and 17.1% for a charging zone within the city’s outer ring road.

6 MotorTransport MTR_121118_006.indd 6

Derby City Council deputy leader Matthew Holmes said: “The message was clear that charging motorists and businesses to enter a clean air zone was not supported nor would it be the right solution for Derby despite other authorities pursuing charging schemes.”

He added that the council was “encouraged that its preferred option had received such substantial support” from the public. The council launched a second consultation last week, setting

out in detail the traffic management measures for the city centre and other measures such as electric vehicle power point initiatives and cycling route schemes.

RHA policy director Duncan Buchanan told MT: “This is the sort of thing we need to have – a good practical and creative solution that tackles the problem and doesn’t just demonise the vehicles, and works with the physical environment.”

Derby is one of the first five cities – the others are Leeds, Birmingham, Southampton and Nottingham – tasked

by Defra with cutting high levels of NO2 by 2020 and directed to consider the introduction of a CAZ schemes to do this. So far Leeds, Birmingham and Southampton have opted for CAZ schemes. Nottingham has rejected a CAZ, choosing to retrofit its buses to Euro-6 standards and require taxis to improve emission standards.

12.11.18

08/11/2018 12:24:42

Everyone talks, one delivers.

The new Actros.

We’re bringing the future onto the road with a multitude of innovative options such as MirrorCam, Active Drive Assist, Multimedia Cockpit and Predictive Powertrain Control, which are set to revolutionise long-distance haulage as we know it today. www.mercedes-benz-trucks.com

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08/11/2018 09:27:07

News

motortransport.co.uk

Highways England report highlights hauliers’ dissatisfaction with management of Strategic Road Network

Hauliers slam state of roads

Shutterstock

By Chris Tindall

Poor road conditions and a failure to open major routes after incidents has led to low levels of satisfaction among hauliers about how motorways and A-roads meet their needs.

A report into the roads net work managed by Highways England found just over half (52%) of freight, logistics and delivery companies are satisfied. Many told Transport Focus, the watchdog behind the report, that the state of the roads is costing them money by pushing up operating costs.

They also said Highways England staff seemed unaware of their obligations to adhere to drivers’ hours rules and the time-critical nature of their jobs. T he research by Transport Focus found: ■ 26% of managers are dissatisfied and only 52% were

satisfied with how Highways England’s roads serve their business; ■ two-fifths of the organisations surveyed said their business is threatened by disruption on the road network; ■ two-thirds need to arrive for delivery or collection within

one hour of the time specified in contractual agreements.

The survey also found dissatisfaction with roadside facilities, which are widely viewed as poor value for money and lacking in secure parking.

The FTA said spending by

Highways England on motorways and A-roads needed to be prioritised and that the results showed core areas of concern. Head of UK policy Christopher Snelling said: “This includes delays in opening roads swiftly following an incident or in sharing adequate information on real-time road updates.

“The logistics industry is the beating heart of the UK economy. For it to continue to operate effectively, it needs a road network fully maintained and adapted to meet the needs of logistics businesses.”

The RHA’s Chrys Rampley said a fundamental issue was the time it takes to clear roads following incidents. “Clear-up rates seem to take forever. Also the timing: why can’t they wait until later in the evening, for example, when it’s quieter to recover vehicles?”

On the feedback from operators about drivers’ hours, Rampley said: “It probably doesn’t even cross Highways England’s mind. There’s probably an education issue there.”

A Highways England spokesman said it was aware how vital motorways and major A-roads are to the logistics industry. “While we are exceeding our targets for road maintenance, for keeping as many lanes open to traffic as possible and for clearing incidents within an hour – things that are important to all road users – we are not complacent.

“We continue to work closely with coach and logistics partners to better understand their needs, so that we can develop our plans and activities, and we value the insight from the Transport Focus report that will help support this work.”

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08/06/2017 16:50 08/11/2018 12:21:29

BRIGHTER LIGHT SAFER WORK!

Improve safety

“

Much of our work is carried out during the hours of darkness.

The Labcraft Banksman uses high-intensity LEDs to project a white light onto the surrounding area, which not only improves personnel safety but also helps to reduce minor collisions and the costs associated with downtime and repairs.

MARK MATKIN. GROUP FLEET MANAGER.

Increase productivity

Reduce costs

”

SAFETY FIRST: Labcraft’s Banksman BM3 is the World’s first Regulation 23 - compliant manoeuvring light. High intensity LEDs come on automatically when in reverse gear to cast a powerful white light around the vehicle to areas where conventional reversing lights cannot reach.

Find out more: Call 01799 513434

www.labcraft.co.uk AD_121118__P9.indd 9

08/11/2018 09:28:48

Focus: Business barometer

motortransport.co.uk

A bumpy ride for diesel and mixed news on rates as Brexit and truck registrations continue to take their toll

Tough times but the future’s bright

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% change on previous quarter

0.8 0.6 0.4 0.2 0.0 Q1-'17

Q2-'17

Q3-'17

Q4-'17

Q1-'18

Q2-'18

Q3-'18

BRENT CRUDE OIL PRICE 90 85 80 75 70 65 60 55

Oct

Sep

Aug

Jul

Jun

May

Apr

50

Inflation

The annual inf lation rate in September is especially important because it is used as the inflationary factor when revising companies’ business rates for the following financial year, starting next April. Business rates rises previously have been pegged to September’s Retail Price Index (RPI), but the link has been changed to September’s Consumer Prices Index (CPI) instead. The change was announced in last November’s budget.

So the latest inflation figures are doubly good news. RPI fell from 3.5% in August to 3.3% in September, but CPI fell even more sharply, from 2.7% to 2.4%. Business rates on their premises are invariably one of operators’ biggest overheads, so a hike of 2.4% rather than 3.3% is a rare piece of good news for the coming year. However, the Bank of England expects CPI inflation to fall even closer towards the 2% target next year.

1.0

Mar

Haulage rates in the third quarter were 1.1% higher than in Q2, according to the latest Services Producer Price Index (SPPI), published last month by the Office for National Statistics (ONS).

This is the highest quarter-on-quarter rate rise since 2011 and is more than double the aggregate increase of 0.5% for all the business services covered by the index. The SPPI is an important measure of inflation for businesses and for the economy in general, given that the service sector accounts for 80% of UK gross domestic product (GDP).

This recent substantial jump in the index means that Q3’s haulage rates were 2.3% higher than a year ago. The equivalent increase across the whole SPPI was 1.8%. Nevertheless, bearing in mind that diesel – usually approximately 35% of a typical artic’s total operating cost – rose by 12% in this 12-month period, the 2.3% rate increase fails to even fully recoup the additional fuel costs, let alone contribute towards hikes in other major expenses such as labour.

1.2

Feb

Confirmation of Brexit uncertainty in the UK road haulage business comes in the latest European new heavy truck registration figures, released last month by ACEA, the association of European vehicle manufacturers.

Provisional numbers covering the first nine months of the year show the heavy truck market (16-tonne GVW and above) across the EU as a whole was up 4.5%.

But registrations in the UK were down 7.9%. The UK was the only major European truck market to shrink in 2018. It remains the third biggest in Europe, but the gap between the UK and second-placed France has increased to a chasm: French registrations rose 9.7% in the first nine months. Even Italy’s economic turmoil does not appear to deter its truck buyers: Italian registrations were up 12.2% and growth in Germany was a modest 2.2%.

Performance of the European heavy truck market is overshadowed by that of the US, where sales of class 8

Haulage rates

HAULAGE RATES

Jan

Truck registrations

(15-tonne GVW and above) were 33% up year-on-year in the first nine months. In China, the world’s biggest market, heavy truck registrations were up by about 15% in the first half of the year but have faltered since then and the year-to-date total is now only on a par with 2017’s.

$/barrel

It has been an expensive couple of months for diesel. The crude oil price soared in late September as traders bought ahead of US sanctions on Iranian oil exports, which came into force on 5 November last year(?).

Then came tensions with Saudi Arabia – the world’s second biggest oil producer – following the murder of a Saudi journalist. Fortunately, the early October peak of $86 (£65)/barrel for Brent crude oil was short-lived because Saudi Arabia said it would hike production to compensate for the loss of Iranian oil.

US oil stocks also turned out to be much higher than forecast, so Brent subsided to approximately $77/barrel in late October.

Nevertheless, October’s average of $82/barrel was a four-year high.

Factoring in the strong dollar and weak pound gives a typical bulk diesel price of 104ppl to 110ppl in October, the highest monthly average since mid-2014.

The US Energy Information Administration’s ‘Short term energy outlook, October’ forecasts Brent will average $75/barrel during 2019 – about 3% higher than the year to date. The chief downward pressure is the risk of slowing global demand if US trade wars with China and Europe were to escalate.

TRUCK REGISTRATIONS >16-TONNE GVW 60,000 2017

Registrations, Jan-Sep

Oil and fuel

2018

50,000 40,000 30,000 20,000 10,000 0 Germany

France

UK

Poland

Italy 12.11.18

07/11/2018 11:08:24

E H T HOW S V C

AY M 2 IL 30 APR NEC NGHAM BIRMI

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08/11/2018 09:31:44

Viewpoint

motortransport.co.uk

How do you like Brexit? Hard or soft?

W

Robert Hardy Director Oakland International

hatever the eventual outcome of Brexit is, it is more than likely we will see the return of customs paperwork. So, does that mean delays at borders? Not necessarily.

To a large degree, friction at the border will be self-imposed by those who failed to prepare or failed to take advantage of the customs simplifications on offer. HMRC handles 55 million entries today and expects this to increase fivefold, with 145,000 traders exposed to customs formalities for the first time. Across Europe that could be more like 400,000 exporters and importers dealing with customs for the first time to facilitate trade to and from the UK. Exports are not so easy as it is not yet clear how the EU will treat imports from the UK. There is talk of an enlarged Operations Stack (lovingly renamed Brock for Brexit). Export document

authentication could be an issue, but we are working hard to mitigate this risk. Again, there are customs processes designed to ease the pain (authorised consignor for example), but a little more clarity is required before a robust export plan can be put in place. Bear in mind that approximately 25% of export trucks are empty and do not require customs paperwork at all.

UK imports is the easier nut to crack. After all, it is our club, and within the parameters of the World Trade Organization we are free to set the rules. Importing is likely to be smooth, particularly for those using the full customs processes aimed at making it so. Simplified frontier declarations, retrospective clearances and customs warehousing can all shift the hurdles and help hauliers avoid delays. We continue to be at the forefront of Brexit planning and will keep you posted.

“THE QUALITY OF WORK IS EXCELLENT, AND THAT’S INVALUABLE TO US.” Michael Pedersen, Chairman - Pederson Contracting Services Ltd.

New technology can bring change and reward ‘H Chris Druce Group news editor, Motor Transport

ad a great day at Freight in the City. Well worth a visit and lots of interesting projects and equipment to look at. I left in a fog, but that was nothing to do with the weather, but rather the puzzling way some speakers believe road transport seems to be the route of all evil,” was one of many tweets I received in response to coverage of the expo at London’s Alexandra Palace last week (6 November).

And I get it. Derby City Council’s decision not to ram a clean air zone down the throats of local businesses and worried hauliers (page 6) in favour of better traffic management instead is great news but stands out because it’s an exception to the general direction of travel.

It’s also true, as you’ll see from our coverage of Freight in the City on page 3, that there is no one-size-fits-all solution, from the types of vehicles we’ll be relying on in the future – especially for final mile deliveries – to how we’ll pay for them, or even what options are available to retrofit fleets (spoiler alert: it’s limited).

As DfT’s Dr Bob Moran said in our first

12 MotorTransport MTR_121118_012.indd 12

seminar session, “clean freight strategy is difficult… but we’ve got to solve it”.

Lynne Goulding, principal consultant for the Visionary Innovation Group at Frost & Sullivan, spelt out some truths in her keynote too. Namely that one inarguable megatrend occurring globally is rapid urbanisation, which will see cities not countries drive future wealth. That presents huge challenges for our sector but also new, and in some cases still to be created, opportunities.

Goulding underlined this with a forecast that global urban logistics spending will have risen from $2.55tn (£1.95tn) in 2011 to $5.98tn by 2020.

So while it’s understandable to sometimes feel the world is against us, the vibrant exhibition hall packed with vehicles and technology that simply didn’t exist a few years back, illustrated that change can also bring reward.

The newspaper for transport operators

To contact us: Tel: 020 8912 +4 digits or email: name.surname@roadtransport.com Editor Steve Hobson 2161 Editor-in-chief Christopher Walton 2163 Group news editor Chris Druce 2158 Group technical editor Colin Barnett 2141 Senior compliance editor Roger Brown 2168 Urban editor Hayley Pink 2165 Group production editor Clare Goldie 2174 Deputy production editor Jo Saunders 2173 Key account manager Andrew Smith 07771 885874 Display sales executive Barnaby Goodman-Smith 2128 Event sales Richard Bennett 07889 823060 Tim George 0755 7677758 Classified and recruitment advertising Head of sales operations Julie McInally 2122 rtmclassified@roadtransport.com Sales director Vic Bunby 2121 Head of marketing Jane Casling 2133 Head of events/MT Awards Stephen Pobjoy 2135 Managing director Andy Salter 2171 Editorial office Road Transport Media, Sixth Floor, Chancery House, St Nicholas Way, Sutton, Surrey SM1 1JB 020 8912 2170 Free copies MT is available free to specified licensed operators under the publisher’s terms of control. For details, email mtsccqueries@roadtransport.com, or call 01772 426705 Subscriptions Tel 0330 333 9544 Quadrant Subscription Services, Rockwood House, Perrymount Road, Haywards Heath, West Sussex RH16 3DH Rates UK £135/year. Europe £163/ year. RoW £163/year. Cheques made payable to Motor Transport.

Apply online at mtssubs.com Registered at the Post Office as a newspaper Published by DVV Media International Ltd © 2018 DVV Media International Ltd ISSN 0027-206 X

Got something to say?

If you would like to contribute to MT’s Viewpoint, email steve.hobson@roadtransport.com

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08/11/2018 09:37:23

Lubricants

motortransport.co.uk

Pouring oil on troubled engines J

Lubricant manufacturers have been slow to supply the burgeoning UK gas-powered truck market with specific engine oils. Carol Millett reports

ohn Lewis Partnership (JLP) general manager, fleet, Justin Laney is puzzled. As a fleet operator who runs more than 60 Scania and Iveco dedicated gas-powered trucks he questions why oil manufacturers have not approached him to offer an oil specifically designed for gas-powered trucks. Laney uses broad-spectrum oils recommended by the manufacturers that can also be used in diesel trucks, but since gas engines run hotter than diesel this means the gas fleet’s service intervals are significantly shorter than that of his diesel vehicles.

“I am surprised that no oil manufacturer has approached us to offer something more specific,” he says. “Our gas-powered fleet does require more oil changes and we would very much like to have the lubricants available that would enable us to change the oil at the same frequency as our diesel trucks as it does add to the routine maintenance costs of the fleet.”

Maintenance costs

JLP fleet engineer Simon Gray adds: “We are carrying out oil changes to our Scania and IVECO gas fleets at 50,000km and 75,000km (respectively) compared to our diesel trucks which run for 100,000km before needing an oil change. I would say 12.11.18

MTR_121118_015-017.indd 15

it is costing us around £800 a year more on maintenance costs per vehicle, in terms of oil changes.”

On the upside both Gray and Laney say this cost is more than offset by other factors. Laney explains: “On the positive side the exhaust and injection systems are much simpler, so we expect the longer-term maintenance benefits to offset the additional routine maintenance costs and the fuel cost savings are still enormous on these vehicles.”

Gas-truck specific

IVECO alternative fuels director Martin Flach takes a similar view. He estimates that IVECO’s Stralis 9-litre and 13-litre gas engines need oil changes at 75,000km and 90,000km respectively, compared with 150,000km for their diesel equivalents, which results in additional maintenance costs of around £100 a month per vehicle. But he adds: “That has to be considered in the light of the potential fuel savings of around £1,000 a month for the gas-powered truck.”

Despite these cost savings Flach says he too is surprised that oil manufacturers aren’t offering the UK market something more specific for gas trucks but adds that he is confident that as the market matures the problem will be solved.

MotorTransport 15

08/11/2018 08:21:18

Lubricants THE SCIENCE BIT

WITH 63 MT LOADS OUR TESTING IS TOUGHER

Since natural gas burns hotter than other hydrocarbon fuels, using a broad-spectrum engine oil rather than one specifically designed for gas-powered trucks can cause problems, putting the engine oil through more severe thermal stress, oxidation and nitration. This may cause the formation of oil sludge and carbon deposits inside the engine.

As natural gas is cleaner and drier than diesel, it also produces fewer carbon particles in the combustion chamber that can lead to poor lubrication of the engine valves.

As a result, most dedicated gas-powered trucks need to have more frequent oil drain services than diesel trucks, adding to maintenance costs and downtime.

Oils specifically designed for gas-powered trucks, such as Shell’s Rimula NG range, can tackle this problem since they effectively lubricate and clean the engine by promoting thermal stability and detergency control.

“Just as the development of diesel engines and their oils over the past 40 years has allowed their oil-drain mileage to be pushed higher and higher, so there is the potential to do the same with gas-powered engines,” he says. “Over time it will be a case of the truck manufacturers pushing the oil manufacturers to improve in this area as both see a common benefit in developing the product.”

Adrian Hill, automotive products manager at Morris Lubricants, believes it’s a case of supply and demand with manufacturers already developing dedicated gas engine oils for the larger markets of North America, India and China. “If you look at Shell and Mobil, because they have a global market, they are producing dedicated gas lubricants fine-tuned to these engines in those markets. So the major oil manufacturing companies are focusing on these markets first, but the UK market will benefit from these developments as demand increases.”

Increasing Chinese market

This is certainly the case with Shell. It already supplies a Shell Rimula oil specifically designed for LNG and CNG trucks to the Chinese market. Launched in 2015 Shell Rimula R5 NG and Shell Rimula R3 NG are designed for use in all vehicle types with engines running on liquified natural gas (LNG) and compressed natural gas (CNG). Shell says the oils offer longer oil-drain intervals, improved oxidation stability, reduced copper corrosion and deposit control.

Shell makes no bones about why it is launching this product in the Chinese market first: the Chinese natural gas vehicle parc is expected to increase from 1.6 million in 2012 to 5 million by 2020. This dwarfs the European market.

The Natural Gas Vehicle Network estimates there are currently

THE ALTERNATIVE Volvo Trucks product manager John Comer points out that not all gas-powered trucks require more frequent oil changes.

Unlike IVECO and Scania, which both use the Otto spark ignition system in their gas engines, Volvo Trucks has opted for Westport/Delphi technology which injects gas, and a small amount of diesel which acts as the ignition medium, through the same injector.

One advantage of this system is that oil drain intervals are at 100,000km – the same frequency and mileage as Volvo’s diesel truck equivalents, Comer explains.

He adds: “Volvo has chosen to take the diesel route when it comes to our G13 gas engine, which offers the same efficiency and torque outputs as the equivalent diesel vehicle, which means there is no reduction in oil drain intervals or the need to change the spark plugs and, as the oil drain costs are the same, there are no increased costs.”

TM

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OIL IT: Volvo’s gas engine uses diesel taken from spark plugs to ignite the gas fuel so oil drain intervals are the same as diesel engines

around 6,500 gas powered trucks in operation across Europe, of which approximately 700 are in the UK. However, this nascent market is growing rapidly with natural gas refuelling station operator Gasrec estimating that in the UK alone HGV trucks above 41 tonnes will reach 5,000 by 2020 and 39,000 by 2027.

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It’s a mystery

So, with such a promising outlook, when will the burgeoning UK market get the benefit of Shell’s Rimula R5 NG and R3 NG products? Unfortunately, this remains shrouded in mystery, for despite repeated calls and attempts to secure interviews with the relevant experts at Shell, the company failed to get back to MT by the time this article went to press with any confirmation as to if, or when, these products will be launched in the UK. Fortunately, oil manufacturers are not the only ones working on solving this issue, with truck manufacturers working hard to fine tune their gas-powered trucks in a way that will tackle this problem.

Scania UK technical manager Aaron McGrath tells MT that Scania engineers have made changes to the engines of its latest generation of gas trucks which have helped to lengthen oil change intervals from 30,000km to 45,000km under normal use.

“As a result of continuous testing and product development, the centrifugal engine oil cleaner is now removed from the latest Scania gas engines, with only the paper filter element remaining to filter the engine oil. This is a clear improvement over previous generations of Scania gas engines, which had a normal service interval of 30,000 kms,” he explains.

McGrath adds that what dictates the oil change interval now is the service life of the spark plugs. “We have set the interval at 45,000 kms for both spark plug replacement and engine oil changes under normal use.”

Home-grown

Scania also develops its own oil in house using oil suppliers to blend oils to meet its requirements. While it does not have an oil specifically designed for its gas-powered trucks, its latest generation D9 and D13 gas engines are factory-filled with Scania LDF-4 engine oil which is a low ash engine oil developed by Scania. The company also recommends customers use either Scania Low Ash or Scania LDF-4 oil in their gas-powered trucks.

In the meantime, Scania is continuing to refine its oils and engines, says McGrath, adding: “I am confident that lubricant and engine technology will continue to advance in the future, meaning increased service intervals for gas-powered engines.”

Hill agrees. He believes it is only a matter of time before a combination of technological advances will eradicate the problem of frequent oil-drain intervals for good.

He says: “Another thing that is changing is that the technology in constituent and component oils is getting better and better and I am sure at some point some very clever minds are going to come up with a way of cooling mobile gas engines which will tackle the problem of heat projection. ■ 12.11.18

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08/11/2018 11:50:00

MT Awards 2018 winner profile Temperature Controlled Operator of the Year

Keeping their cool With more than 50 years on the road, family business McBurney Transport Group says it can deal with whatever problems arise – and has the testimonials to prove it

JUST RIGHT: Enterprise sales director John Collins, second right, hands over the trophy to McBurney Transport Group operations manager Peter Rearden, second left, and the McBurney team

18 MotorTransport MTR_121118_018-019.indd 18

F

ounded in 1965 by Norman McBurney OBE with a single lorry, McBurney Transport has grown over the past 53 years to become one of the leading temperature controlled operators in the UK and Ireland. With customers including most of the major supermarkets and leading food and drink manufacturers and distributors, the McBurney Transport Group remains very much a family affair, with both founding members Norman and Lynn McBurney, together with all five of their children, involved in the business.

Finance director Pamela McCrea is one of those five. She said: “The company was founded by my mum and dad, and over the years it has grown as our customers required it to do and we have also acquired businesses where the fit was right. We all have an interest in the business and we were brought up having a real desire to make it as good as it could be.”

The group was formed through the acquisition of, logistics and warehousing business Bondelivery 28 years ago and in 2000 a specialised refrigerated division, McBurney Refrigeration, was added with the purchase of P&O’s refrigerated division. “We could see the need for temperature controlled haulage was becoming a growing market and the best way into it was to acquire businesses and then expand them,” said McCrea. “Then we had customers who were using a cold store in Liverpool, which was up for sale, and in 2003 we decided to buy it to increase the services we could offer. So that was a natural progression into the cold storage and warehousing side.”

Famous livery

The famous yellow McBurney livery came about by chance when Norman acquired his first lorry second-hand. “He went out and obtained a contract to get started and that’s the history of the yellow lorry,” explained McCrea.

“He has kept with the yellow lorries ever since.”

The company now employs 800 staff and runs 370 trucks and 1,050 trailers (including 188 double-capacity refrigerated trailers) across eight sites on both sides of the Irish border and the UK mainland. A glance at McBurney Transport Group’s website tells you the firm runs a mix of Volvo, which makes up two-thirds 12.11.18

08/11/2018 08:18:28

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No logistics company is immune from the UK-wide driver shortage and the McBurney Transport Group has to keep pace with the packages on offer. “We believe drivers are a key asset and are exploring ways to ensure we retain our experienced and trained drivers and have set up different schemes to attract new drivers into the industry,” said McCrea.

Closely fought category

of the fleet, DAF, MAN and Scania trucks, while its trailers are mainly supplied by local Northern Irish trailer companies SDC and Gray & Adams.

McBurney Transport’s success has been inextricably linked with the growth in traffic across the Irish Sea and its depot locations are carefully chosen to provide the best and most cost effective service to customers in the UK and Ireland. “It’s been sheer hard work and dedication over the years that has got us this far,” said McCrea. “We believe in reinvesting in the business to ensure we can keep providing a quality service.”

Norman McBurney is still heavily involved in the firm and has no plans to hang up his boots any time soon, while his wife Lynn is also still involved in the compliance aspects of the business. But Pamela and her father were quick to pay tribute to the whole management team and all the staff, who have contributed to the firm’s success.

“We have a good team of people and we always try to promote from within rather than just bring somebody in,” McCrea said. “It encourages them, and they already have the knowledge of how we operate. We are still very much a family business but as the group has grown we have a full management structure in place.” McBurney agreed. “There are plenty of good people here and that's what it takes to 12.11.18

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keep a business going. It’s good to know the company is in safe hands” While the McBurney Transport Group does carry ambient products, at least 70% of its £100m annual revenue is in transporting and storing refrigerated and frozen food products including dairy, chicken and fresh fruit. “We also receive a lot of European produce into our depot in Liverpool,” said McCrea. “We have a 24,500 pallet warehouse on a 12-acre site and we consolidate that with other UK produce to take that to the customers on the Irish side.

Unaccompanied trailers

To make maximum use of drivers’ time and resources, a good proportion of McBurney Transport’s Irish Sea freight moves on unaccompanied trailers. “We have drivers and vehicles in every depot and try to match the work to the resources,” said McCrea.

The group has excellent relationships with the Irish Sea ferry operators, ensuring it always gets the slots it needs even at peak periods.

“While the uncertainties of Brexit are a challenge, the group’s ethos is whatever the outcome of Brexit, we have the experience and infrastructure to deal with any operational or system changes to ensure the service we supply to all our Irish Sea customers is as uninterrupted as possible,” said McCrea.

When picking McBurney Transport Group as the winner in a closely fought category, the judges praised the company as a “commercially strong business that invests in its people today and tomorrow by developing the next generation”.

The judges were also impressed by the excellent customer testimonials which had a common thread –when the going gets tough, McBurney consistently delivers.

“Something we have always stood by is the quality of our service,” said McCrea. “It’s very important to get the job done well every single time. There are always hiccups along the way but whatever the season and disruption due to weather we have the experience to deal with it.

“It’s important to have a good relationship with customers and suppliers and to be able to communicate well. Our operation is 364 days, seven days a week.

“Service levels are very important to our customers. Especially at times like Christmas, when our customers are under pressure, they need to know that we can get their deliveries done.”

That is why winning Temperature Controlled Operator of the Year was such a well-deserved accolade. “We were delighted to win it,” she said.

“It’s lovely for our business to be chosen for this UK award and we hope it shows everyone that we are a major player in the market and maybe they should consider using us if they haven’t before.” ■ MotorTransport 19

08/11/2018 08:18:48

MT Awards 2018 winner profile Livery of the Year

A winning environment Proudly declaring its environmental credentials saw Howard Tenens take the Motor Transport Livery of the Year Award 2018

T

he 2018 Motor Transport Awards were particularly memorable for Howard Tenens – the Stroud, Gloucestershire-based logistics company was shortlisted for not one but two awards: Livery of the Year and Haulier of the Year. Head of development Matt Davis described winning Livery of the Year as “phenomenal”. It is the company’s first Motor Transport Awards win.

“For us, Motor Transport is such a biggie,” said Davis. “It’s the industry staple, so the fact that we were shortlisted for Haulier of the Year was a huge accolade we were really proud of, as well as getting Livery of the Year.

“I think there has been a lot of hard work over the past 12 months in particular – driving the business forward and continued growth.”

Loud and proud

Davis has worked for Howard Tenens for more than 15 years and said there has been a shift in the company being louder and prouder of its work, in particular about making its fleet more sustainable and environmentally friendly.

“For once, we’d actually started shouting about it,” he said. “We’d always just gone underneath the surface. So to be rewarded for that, to get recognition for that, was so important.

It was out of this world, it’s something we are so proud of.”

Howard Tenens’ environmental journey began in 2008 when chairman Peter Morris recognised that the company needed to reduce its carbon footprint and set it on the road to becoming an industry leader and pioneer of dual-fuel technology.

As part of that process in October 2017, in partnership with Innovate UK, Howard Tenens took delivery of the UK’s first CNG trucks as part of the ‘dedicated to gas’ project aimed at lowering emissions in freight. The two trucks are now two-thirds of the way through an 18-month trial.

To highlight the significance of the trucks and the company’s commitment to the environment it was decided to commission a new livery.

“Once we saw the calibre of the trucks, we thought, actually let’s treat this as a separate project. Let’s really go out and match the environmental credentials with the livery, and a design that truly speaks volumes,” said Davis.

Five livery options were considered by the board.

“As you can imagine, something like livery is really subjective, so you’ve got a room full of people going ‘I like that one’. However, there was a consistent theme even though some people liked bits of other elements; the ‘cleaner planet’ stood out for everyone,” said Davis.

Sleek and timeless

The chosen livery certainly impressed the Motor Transport Awards judges with its “sleek, stunning and timeless” design. “This is an exceptional design and execution of an important message regarding sustainability, environmental responsibility and the company’s commitment to this objective,” said one judge.

The new livery was intended to capture the imagination of Howard Tenens’ staff, the 20 MotorTransport MTR_121118_020-021.indd 20

12.11.18

07/11/2018 14:15:30

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industry and the public. “There’s a bit of an internal battle about who gets to drive those vehicles, as they look so smart,” said Davis.

A fortunate piece of timing saw the new livery unveiling coincide with the television airing of David Attenborough’s seminal documentary Blue Planet II. “Compared to others on the road it gives a certain perception about the company – a contemporary look and feel,” said Davis. “It was fortunate timing with everything with the Blue Planet programme, and David Attenborough talking about plastics and things like that.

multi-drop deliveries and return to the Swindon depot. They were to have been switched to biogas part-way through the trial but a delay in the construction of a prototype biogas plant means the company has opted to purchase green gas certificates instead.

“This means we are using a ‘virtual’ supply of biomethane but can still attribute the carbon benefits to the vehicles,” said Davis. “When taking into account the green gas certificates the CO2 emissions reduce by approximately 70% compared to diesel.”

As part of its commitment to the environ-

ment Howard Tenens also has in a place a number of other initiatives in place at its sites.

Lighting is switched on by motion sensors, solar panels are mounted on roofs and the company has “done a lot of work on solar farms across the UK”, said Davis.

Future plans include introducing several more CNG trucks into the 524-strong fleet at the end of the year and continuing an international expansion in warehousing. It seems that the future is not only bright for Howard Tenens in its 65th year of business, it is also green. ■

Positive perceptions

“More people who weren’t involved with logistics would see it and see the link, which again was a nice thing. And just in terms of customers, we’d have people say ‘we have seen that vehicle, or we saw that in Motor Transport’, so it’s been a good reaction all round.”

The livery is a world away from the company’s historic design, which Davis describes as “very much being the company logo and contact details”. It was when customers started asking if they could advertise on the side of Howard Tenens’ trucks that “we started thinking, that if customers want to do this, we should start doing this for ourselves”.

The CNG trucks were the ideal place to start.

They can travel up to 380 miles on one tank of CNG, enough to get to London, undertake 12.11.18

MTR_121118_020-021.indd 21

LOOK SMART: Pirelli Truck MD Simon Michael, centre, presents the award to Karl Hodgkinson, Howard Tenens group commercial director, second left, and Beth O’Neill, head of commercial MotorTransport 21

07/11/2018 14:15:44

MT Awards 2018 winner profile Technical Excellence Award

Pooled resources Winner of the Technical Excellence award, Whirlpool Corporation impressed with its move from trucks to heavy vans, backed by a team-driven approach and rigorous internal audit process

TEAM PLAYER: Brett Emerson, Hankook Tyre UK sales director, second left, presents the trophy to Paul Pinfold, Whirlpool UK Appliances logistics fleet operations manager

W

hirlpool Corporation, the world’s largest appliance manufacturer, purchased Indesit Company in 2014.

Whirlpool markets the Indesit, Hotpoint, Whirlpool and KitchenAid brands in the UK, and is the only UK appliance manufacturer to operate its own in-house delivery and installation service, Hotpoint Home Solutions (HHS).

By selecting Whirlpool as the Technical Excellence award winner, the judges positively commented on the use of targeted projects to evaluate different vehicles and specifications to drive efficiency and also praised the strong communication with employees throughout the organisation.

HHS operates 125 delivery vehicles from 11 satellite depots supplied from the national distribution centre in Raunds, Northampton-

shire. This was a reduction of 30% compared to the previous year following the introduction of seven-day deliveries.

In recent years HHS has been experimenting with 5-tonne and now 7-tonne, 3-litre IVECO New Daily vans as alternatives to its traditional DAF LF 7.5-tonne trucks. It retains a handful of 10-tonne LFs with sleeper cabs for depots with two-day delivery routes.

Lower costs and bigger payloads

Paul Pinfold, logistics fleet operations manager, commented: “Based on 125 vehicles, I’ve got 20 at 5 tonnes, five at 10 tonnes and the rest are at 7.5 tonnes.” He added: “I’ve got 60 due out and we will be replacing them by the end of this year with 60 7-tonners. The Daily vehicles can do the same job at a significantly lower cost per mile and with a bigger payload.”

The switch has mainly been driven by the

increase in online sales and single unit deliveries direct to the consumer’s home which often additionally involve installation and connection of the new appliance as well as removal and disposal of the old appliance.

“The way the business has progressed, in terms of increased home deliveries with installations and connections and therefore fewer possible units per driver day, has enabled us to move forward with a vehicle that’s got a slightly shorter body, but has in addition given us a payload capacity increase of 700kg,” said Pinfold. “We evaluated the 7-tonne vehicle over the past 12 months and it’s gone really well.

There are significant savings over five years on these 60 vehicles due to lower fixed and variable running costs.”

The Daily achieved 18mpg during the trial, around 2mpg better than the outgoing 7.5-tonne LFs, but is Pinfold concerned about their reliability and longevity?

Driver feedback

“You’re effectively going to a heavy van,” he conceded. “So you’ve got a mechanical handbrake and power hydraulic brakes. We minimise that potential risk to some degree by investing in a full maintenance contract. The manufacturer and the supplying dealer have taken that risk in terms of giving us a fixed cost for five years and up to 360,000km.”

Perhaps even more importantly, how have HHS’s long-serving and highly experienced drivers taken to moving from ‘proper’ trucks to heavy vans?

“We’ve had very good driver feedback from the trial, with almost 90% of it positive,” said Pinfold. “The narrower box and therefore reduced overall width has had good driver feedback due to improved accessibility at restricted delivery points” The New Daily units are fitted with IVECO’s fully automatic HIMATIC gearbox. “The gearboxes are getting some very good feedback,” said Pinfold. “It’s the first time we’ve gone fully truly automatic.”

The Daily’s tail-lifts are rated at 500kg rather than 1,000kg on the LFs. “We’ve gone to DEL and in my opinion it’s a far simpler unit,” said 22 MotorTransport MTR_121118_022-023.indd 22

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ALL CHANGE: Whirlpool is moving away from its traditional 7.5-tonne trucks

Pinfold. “It also gives us slightly more payload.”

Once all the fleet is Euro-6, is Pinfold convinced Whirlpool will be future-proof in terms of entry into the various low emissions and clean air zones being introduced in London and elsewhere?

“Yes, I am confident we will be,” he said.

“The first pinch point for us is going to be our Hayes depot in West London in April 2019 which we’ll be equipped to do at Euro-6. I don’t see in the next two to three years that it will be more than a Euro-6 requirement from this location.

“We’ve always been ahead on replacement cycles so we jumped from Euro-3 straight to Euro-5 and then into some of the first Euro-6.

We’ve had good experience with them so it doesn’t concern us.”

But Pinfold knows the trend is heading inexorably towards zero emissions in London and he wants to be ahead of that curve too.

“We are working on electric vehicles for the Hayes depot and what the Daily vehicle has also given us is options with gas and electric,” he said. “We’ve also got a project with Daimler on the FUSO Canter and are looking at the charging infrastructure requirements at Hayes.

We will probably look to move half of the vehicles, those which go into central London, to electric within the next 12 months so we’re ahead of the game on that.”

Operational feedback

“That then gives us some operational experience on electric and as I’ve got another replacement plan due out in 2019 and 2020 we will have the flexibility to be able to meet the expected requirements of ULEZs in other major UK cities as well as London.”

Another aspect of Whirlpool’s entry that impressed the judging panel was its rigorous internal auditing process that sees Pinfold’s fleet management team carry out three compli12.11.18

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ance audits every year at each depot.

In 2017, the final audit round achieved a near-perfect 98% compliance score, but rather than be satisfied with this, Pinfold is always looking to improve further.

Further improvements

“We continuously look for additional fleet operational areas to include in the audit,” he said. “When we first started the journey we would just look at our own fleet, whereas now we encompass the spot hire fleet too. What we’ve shown is actually we can maintain a good standard and then still further improve on it.

It’s continuously evolving and we measure almost everything.”

But Pinfold insisted that the auditors are not seen as ‘Big Brother’ from head office, finding fault with the operational teams. “There’s no silo mentality with what we do,” he said. “We work together as one team. We’re a family and we support each other; we all work for the same operational successes.”

This year HHS is putting each of its depot supervisors through a one-week intensive training course at its national training academy in Manchester, which covers all areas of their operational responsibility.

One day of the course is spent covering local fleet management processes and procedures, audit standards, legal obligations and what is required to comply with Pinfold’s exacting and specific standards.

“As much as we did beforehand to pass down the fleet knowledge and expertise to the depot management teams, we’re now enhancing that further,” he said. “We’re getting them to increase their knowledge and their expectations, and saying ‘you can still go higher, there’s still 99% and 100% to achieve’. It would be a great achievement to get to 100% nationally.”

“It’s not impossible to be perfect. Yes, you’re down to a minor piece of damage on a vehicle

that’s not been reported, a missing high pressure valve cap or loose wheel nut indicator, and a cab that’s not quite as clean as it could be. We don’t have legislative compliance issues, it’s down to micro-managing very specific details.”

So far Pinfold has not jumped on the FORS or CLOCS bandwagons but with such a high internal audit score, has he considered joining the DVSA’s Earned Recognition scheme?

“Yes, we have,” he said. “The DVSA was unsure about how they were going to manage it, what the KPIs were going to be and how those KPIs were to be produced. We’ve waited for that to become clear, but it is something now which we can achieve quite easily because we’re doing it anyway.”

HHS achieved an OCRS G03 across all O-licences in 2017 with a national first time MoT pass rate of 97.6%

Never complacent

While Indesit/Whirlpool has now picked up six MT Awards since 2007, Pinfold never gets complacent about his team’s success.

“Fleet operational efficiency projects, the internal audit process, established fleet management procedures and ongoing driver and depot supervisor training demonstrate our commitment to fleet compliance and our continual improvement ethos,” he said. “The compliance scores and OCRS standing tell us that we are getting things right, however we must never and will never become complacent; there is always something that can be improved upon.

For us to be recognised by our industry peers for our achievements so far is just marvellous recognition for the team.

“I felt honoured and privileged to collect the award on behalf of the team. We’re really close-knit and it is a full team effort. It’s a great feeling and proud moment but for the whole team as well and drives you to want to achieve even more.” ■ MotorTransport 23

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