Scott’s Transport's collapse triggers ‘serious concerns’ about Australia’s supply chain
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- čas přidán 17. 03. 2023
- Sky News Business Editor Ross Greenwood says the collapse of the Scott’s Transport company triggered “serious concerns” about Australia's supply chain.
“The real worry is that Scott's may be the first of many to fail as cost pressures rise in the whole trucking industry,” Mr Greenwood said.
Two things which were noteworthy:
1. It was bought by a private equity firm in 2020. What are the chances that was a leveraged buyout, i.e. they saddled Scott's balance sheet with debt to fund the takeover?
2. Remember when politicians were saying stuff like "Stay at home. We'll figure out the economy later"? Doesn't seem like they managed to figure it out, does it?
Yep I know the story well. My advice to any non industry participant that wants to buy out a haulage firm and “financialise” it, is fuck around and find out.
Trucking is a cottage industry, the corporations are the marginal outliers in the game long term.
one noteworthy thing you totally failed to note above.. AHG paid approx 120 mill to acquire Scotts, Rand Harris and JAT, few years later Lindsays Australia and an American company were going to buy it off them for $250 million but then they sold it to Anchorage for $75 million. It was cactus way before Anchorage bought it
@@topendtrucker So they were clueless financial types from the get go who didn’t know what a Kenworth is. Who’d of thought?
Government has a lot to answer for. Fuel pricing and over regulation, poor governance.
With impossible KPIs and strict delivery times, plus you have the police and Transport Department cracking down on log books and other things, it's literally makes no sense to be a truck driver in this country.
So true!
thats why there is a massive increase in Indian drivers.
@@klord-is9ft you are not a loser due to Indians. Indians are here because we had too many losers like you. Someone has to pay taxes for your Centrelink.
Not just Indians, but Pakistanis and East Europeans too.
We have the same problem here in the USA, I sold my semi last year before our own trucking collapse. It's a tell tale of a coming recession
Somehow, Australians think they’re better than the rest of the world and that it’s ‘different’ here
Get the Public Servants to drive them they do Fk all else. 😂
First the building industry, now the trucking industry. Something seriously wrong with the way we're running the country.
We are not running the country.
Two high-demand industries struggling? I sense we are being lied to by someone.
No, the trucking industry has been suffering for years now .
With the liberal Labor and greens running the country what can we expect but everything to collapse
Government over regulation has driven a lot of experienced older drivers out of the industry, now we have a shortage of drivers and big companies are hiring anyone to fill seats in trucks, this will make it more dangerous on the roads and will cause more kneejerk over regulation from bureaucrats that know nothing about the transport industry, just making it harder
Lots of Pakistanis and eastern Europeans too..
Its easy to fix the supply chain issue just pay people and dont expect stuff for free
Definitely if the government doesn't see what is happening on the ground then they cannot see the biggest picture in Australia where we rely on transport for the smooth and productive work towards supply demand and sales
The government can't control a company taking on way too much debt and signing contracts that weren't competitive.
@@wuper2270 Yes they can. Regulate the cowboys and corporations into submission. Up the TWU it seems these guys understand entirely how truck drivers think.
@@shaneblack8082 business fail, it's apart of the capitalistic market we have going right now. If the government saved every company that was reckless with lending then the government would collapse. Please use your head.
@Jimmy 009 So just avoid them. I’m 46 been driving HR in Sydney since 2002 apart from emergency avacado hand unloads for $70 an hour I never go to a major supermarket. Too busy making real money to accept that crap.
BTW - 5 minutes late? Turnaround on a semi full of quarter of a million of perishables?? Yeah Nuh Bro
@@wuper2270 Businesses that are predatory fail. Owner Driver truck businesses only fail on leveraging. If they allowed SMSF to buy trucks and give up and coming drivers a working basis to grow and thrive then - trucking crisis solved.
BTW - new Euro VI semis are between $300 to $500k, what 24 yo can raise that.
High price of diesel is responsible for this
Why is diesel 20c a litre more then petrol ?
It's called RECORD PROFITS
The demand balance of diesel and petrol changed permanently as a result of the pandemic lockdowns.
It's less refined and cheaper to produce
Oil company greed compounded by government excise on diesel.
@@ricky6864 That is complete bullshit.
How did it collapse ? Hardly seems possible unless it’s intentional.
Trucking operations can go tits-up very quickly if one of their customers becomes tardy with payments.
@@jonathanrabbitt yet their demand has increased by nearly 50% the past 3 years which would increase revenue. A company that’s been around since the 50s isn’t just going bankrupt. They have solid customers and any cost increases would be passed on to the consumer, which it most definitely has.
@@atleastimgenuine3566 It sounds like they have fixed term/price contracts so they can't pass on the increased costs to their customers.
They were working for below there cost of production . Basically the frozen and chilled products that you buy from the supermarket are too cheap .
@@atleastimgenuine3566 It is entirely possible for a company to be coerced it taking on unprofitable contracts, particularly if they already have large contacts that can be put in jeopardy. Not saying that happened, but increasing revenue and market share does not always lead to profitability.
All planned. Without food the sheep will follow quicker than their boosters 😂😂😂😂
As these big players fall over the freight component of groceries starts to inflate exponentially and new freight players won't invest in a buisness with marginal profitability
They might use Australian workers to drive the trucks not blokes from India
@@darylephillips6778 the margins are so skinny freight is now not a viable buisness model no matter who drives
Here comes that man made famine we were promised at Davos
Exactly 💯 %. Depopulation will rise significantly soon. All scripted 😮
No such Famine was ever promised at Davos
All going to the wef plan.
You will not travel, you will own nothing and you will learn to love the bbq bugs
Off on a trip next week, own heaps of stuff and will be BBQing plenty of steak etc whilst there.
You can travel on the trucks.
Let me guess as an American: These are union jobs that Scott's had to pay in order to operate? If you just let the free market work (people working at a wage they agree to) you wouldn't have this. Unions kill every industry. You may not have the best job, but at least you HAVE A JOB.
Ha ha ha the FREEDUMB market. You covidiot
Yes, you are correct! "
Fortunately we don't have the same mindset here as your lot and from what I've seen truck drivers don't have a particularly high hourly rate but tend to do plenty of hours.
I worked in a warehouse and I was earning way more per hour than the guys driving the trucks in general.
Weird considering the responsibility that they have and the amount of experience they need to do the job safely and well.
This would be more about long term cut throat contracts, slim margins and increasing costs that they couldn't pass on.
I would be blaming the big customers who pretty much dictate prices in these deals.
You can pretend that $15 ph is a wage but here it's pocket money and given the issues the US has maybe telling others how things should be is a bit silly?
Unions don't actually have that much power in Australia any more. There's no big difference between the pay rates of union and non-union jobs.
Hey Mate - You can take your Free Market BS and stick it where the sun don't shine...
Scotts a company that had Indian drivers not Australian drivers behind the wheel
Don’t laugh. They’re useless and expensive on the equipment. Biggest open secret in the industry.
Then they cut rates and punish the environment with filthy old shit boxes when they go owner driver.
I'd love to see how much their insurance premiums and damages bills went up over the last 5 years.
There were many Asian drivers and Eastern European drivers as well.
@@philliphunt5348 When you put the accounts dept in command of everything and have spineless management that is only focused on quarterly results, you go super broke in transport.
The equipment maintenance and insurance bill is pointless when you have trucks that cannot be fixed anymore through inexperienced drivers.
@@joelc9439 These guys are actually pretty good. They’re professionals with respect for the equipment and want to be life long drivers. They love Scania and Volvo.
Never a good thing dealing with retailers, they screw everyone including customers 🤬
Woolworths has had a bad reputation with this behaviour for decades..
@@petesmitt yes mate I have a friend who deals with them, they give a good deal the first year, then they say they’ll give you all the business, you drop your other customers then they have you, this is when they screw your margins when you have no other options, very cut throat business 🤬
Stories in other financial media say Scott was a tenant at those warehouses. Expect the owners are keen to find a new tenant. Why did Toll and Linfox decide to walk away from buying Scott's? Maybe because the customers were there for the taking without the debt and old trucks. Look at that angle, not the David Koch style beat-up.
What do mean? Lot's of other companies are not driving brand new trucks.
@joelc9439 AFR said Scott's had $100 million in debt and a fleet of aging trucks that needed replacing. Aging trucks have more breakdowns. The company was under investigation by the safety regulator due to incidents of fires, speeding and accidents.
Grocery prices have gone through the roof, we are told due to increased freight costs, someone is being compensated for supposed cost pressures
Dispicable.
I used to drive trucks local and instate about 14 years ago but I left it because I got sick of the bad treatment and bad pay and log books make things worse you can drive when you're tired but you're not allowed to drive when you're keen to keep going the fines for small mistakes are ridiculous I believe truck driving would be the one of the most dangerous jobs in Australia with no reward $
Just the roads alone are a nightmare..
The heavy over-regulation is a joke and the NHVR officers are s different breed..
agree mate, drove a truck working 14 hr days. Very dangerous, boss was a wanker, pay ph was shit. Got out of it mate wont be back
Guess Woolies and Coles will have to run their own trucking business to supply themselves with goods . They will pass on the cost as usual .
ALL BY DESIGN....AGAIN
Just a sign of an economic downturn for which we are long overdue.
Better hide under your bed if you're so concerned about it all.
We should be moving containers via rail and not on trucks. Trucks should only be used for distribution not freight hauling.
More Sea transport would help.
@@coconuciferanuts339 More flag of convenience ships with crew from third world countries, great idea for the owner classes but not so good for Australian jobs.
You underestimate the immense amount of freight transported by road , due to the lack of rail infrastructure in Australia it would take 30-40 years of development to even contemplate the possibility to efficiently implement such a mammoth project.
More people should consume less
Update the train tracks so we don't have to rely heavily on trucks.
Dumbest comment on the subject I've seen so far
They use trains to deliver as well
Not everywhere has trains that are close by.
Opposite is happening in many areas from what I've seen.
@@oldbloke204definitely happening in WA . Small gauge lines have all shut down . The amount of trucks on the roads in the wheatbelt are destroying the roads , they weren’t designed for B-triples .
All by design 🤔
I'm expecting the half wit politicians to advise less trucks on the road will help..
That will suit their green agenda.
Stop over regulating the industry... consistently being hassled by NHVR...
I'm a truck driver, and I've been thinking about leaving..
Same here Josh. I know so many others that have left or thinking of leaving the industry. Even as owner drivers, the fuel, tolls, traffic are killing the industry.
@Phillip Hunt... completely agree mate. The thing that frustrates me the most is when something goes tragically wrong it's the truck driver's fault or the industry's fault.. so they regulate drivers even more..so many good drivers have left the industry because it's getting to a point where it's just not worth it.
People would fall over if they knew the running costs of a prime mover just pulling a single.
Already feeling the effects here in rural south Australia
Are they finding alternative transport at all?
I doubt that there are many companies that could even ramp up enough in a short time to cover this.
@Fruit salad ????
@Old Bloke some, unfortunately, Scott's also were in charge of many of the cold storage warehouses. As such, much of the goods are just no longer available
What are you lacking?
@@rogermckinnon5738 Yeah it's all pretty ugly really.
Plus the major supermarkets take months to pay their transport costs when making BILLIONS in profits
"Can't bring in any over-seas drivers..." Um, Haven't we seen numerous crashes involving "over-seas drivers"?
Why would I as an ex truck driver work for $23/hr and be away from home for days when I can work as a traffic controller for $45/hr and be home everyday? Pretty easy to see why drivers and operators are leaving the industry. The Govt doesn't give a shit.
Many other companies are paying $28 for their truck drivers.
Government should come to rescue since we can afford to give humanitarian help outside This is our food delivery people proud Australian company
Oh shut up... it's not the government.. all these private company CEOs should help .
@@joelc9439 If you bothered to read my comment You would know I don’t blame government There is government funding for such situations Trucks are backbone of Australia We should help them
I'm a New Zealander. I follow a You Tube channel from the USA, 'Clutch Trucker", who operates a truck and trailer private business. From his info i see he sometimes struggles to get loading from A to B which pays a reasonable rate and sometimes is struggling to get jobs that give much profit over and above his running costs. Bob. Across the Ditch.
Shortage of drivers here in NZ 🇳🇿 too..not to mention shortage of urban bus drivers...with services thinned out to spread the available manpower.
I would love to see what a forensic accountant would have to say after going through a decade or so worth of Scott's books. This hasn't happened overnight.
I was audience to a gentleman who had a little bit of insight into Scott's practices, several years ago. He was scathing of the business from every perspective from contract procurement, to maintenance and fleet acquisition, to the vetting of drivers and their training.
I've heard similar, and there has always been a background white noise of troubles, with occasional media reports coming out.
What "first of many"? A couple of companies already closed down a few months ago.
C’mon. Scott’s failure was due to IT more than anything else. The chaos of an IT upgrade that didn’t work from day 1 is the real story and you lot have missed it for sensationalist rubbish instead.
Scott nothing to do with you.
I've been attacked for certain factual statements on this channel on previous videos I've asked these entities to explain but run away with tail between legs proving they know nothing
You're the dude who used to film Qantas 'chemtrails' right?
@@bobhawke7373 Chemtrails do not exist it's Stratosphere Aerosol Injection & yes
@@bobhawke7373 And they are all involved I've filmed many different Airlines
@@Blackjack_Official 🤣🤣🤣
@@oldbloke204 Glad you think it's so funny. You're probably on your 5th booster, too. 🤡
i just went to IGA and TWO bbq lamb chops $22 dollars
Albonomics hard at work.
It won't be easy under Albanese.
Same as the building industry ….. Scott’s are being held to delivery contracts that can no longer be afforded….. diesel ….. wages ….. all up up up up.
Only way to dodge these contract commitments is just to fold up shop.
There's plenty of foreign drivers around here .
Well there's a lot of American companies going out of business to due
high cost inflation rates
State governments have made it much harder for young drivers to get their P plates... the knock on effect is less drivers moving up through the ranks to get their truck licences.
Just another unintended consequence from whinging, condescending old people.
AustraliaStan is SCREWED!
a victim of ALBO's green energy crisis. no one in this presentation is the increased electricity cost. refrigerated food requires massive amounts of power in warehousing at the depo. which is probably the main cause of the company closure
Gotta appreciate Labor supporting businesses...
Labour love people on the dole - can claim they are supporting them.
Saw a sticker on the back of a truck without trucks Australia stops
The 1st thing that these business owners & CEO’S want is to bring in foreign labour. How about training Australians & giving young blokes & women traineeships ???
Many local Australians do not want to be trained you muppet..
took a dive for reset team after a couple of fraud scandals
Government not ranking trucking as a priority occupation?
It's the occupation that every other occupation, bar none, relies on.
Everything from a sweeping brush to a surgeon's scalpel comes on a truck.
Run on cheap rates regardless of the size of the company and it will fall over eventually. Seems good profits are enjoyed by the customer at the expense of transport it's been like it for years the stories I heard out of this mob im not surprised. Shouldn't be difficult for most of the drivers forkies etc to get work.
There are heaps of use that used to drive ....and got sick of the transport department lookin for spellin mistakes or stupid stuff that had nothing to do with real safety issues...That was like 15 years ago ...nothing prob has changed these days....
Truck driving used to be a good job with perks and family benefits but has now become to some "a joke". The average age of a truckie is into the mid to late 50's and drivers are leaving the industry much faster than they can be created. This need not be. You only need a truck driver's licence to drive a heavy truck and that involves no university debt and is a job even a high school dropout could do and is still very much needed. It would also help if Coles, Woolwoths and Aldi would play more to transport their goods for the sake of transport companies and their drivers,
In some companies it still a good job..
Should be some cheap prime movers on the market soon .
There’s always a silver lining 🙂
Good luck getting the smell out of it.
@@philliphunt5348 😂😂😂😂💩
Been trying to find a truck driving job in the South West of Western Australia for 3 Years now they all want a minimum of 2 years of experience. I have had one job my whole life been in the family business for 30 years and wanted to try something new still no jobs available.
Why did you leave the family business?
@Joel C I haven't left yet we have gone from having 12 staff 10 years ago and now just me and my father. unfortunately, we are in a dying trade
Awwww …truck me dead! Sooo, then - Australia is ‘different’ - until we’re not, eyyyy 😮 hundreds of builders collapsing is perfectly normal, of course
get rid of the fuel tax period. Also how are they not buying a new truck every week? Yes new trucks cost but they can savey on fuel which can be thousands of dollars per week.
No one wants to work anymore
It’s about time government allowing companies to take over a majority of the market!They should have only be allowed to supply one shopping chain
Scott no mates that can step up ?
Useless greed !
Scott’s suffered the same problem so many businesses have today …….people being too lazy to work, We are paying them too much for enjoying sitting at home on their backsides
👍agree
Not exactly that, they corporatised what is still very much a passion project for us drivers. We love the business but not the corporate culture these conglomerates bring.
If we wanted to be wage slave drones we’d work at QANTAS or WESTPAC.
Brace for sharp food price hikes, cheap food is History folks
@@jakedemuss90212 yeah I can see that
Demons have no need for food right?
Without Trucks Australia Stops!
Train own own young people to learn to drive trucks! Aussies first!
We can train them but it isn't a quick process.. 12 plus months to get your licence to drive a semi after getting a rigid licence.. and young people don't want to earn the sort of wages truckies earn..
Many local Australians do not want to be trained they want the dole instead!! You are a muppet..
Fuel tax’s
Pretty obvious why, the Australian people have no idea how milk gets into their fridge
One thing about this particular type of trucking industry is the extra amount of energy required. It's not just the fuel to run the trucks, but also the fuel for the reefer units and the power to run the massive refrigerated warehouses.
People are reaping the rewards for voting for people who can't keep energy costs down.
Isnt Angkerage owned by BlackRock Hmmm
WHO IS REALLY MAKING THE MONEY ?????????????????????????????/
Private equity firms and other institutional investors for the most part.
This could be fixed. But seems the party that cares doesnt want to. They like the predecessors are happy for it all to fall apart. They in power will be ok. They will not suffer. I will, you will. They have no skin in the game and therefor no care for the results.
So what's wrong with rail? Trucking in Oz has been crap from the beginning. The trucking industry worked hard to destroy rail... Well, no sympathy! Put it all back on rail.
Toll ,Linfox Rocktrans and half a dozen others are rubbing their hands together about to pick up all the contracts. Scotts went under because the recent owners deliberately run it into the ground. Scotts were the main transport we used in my previous position position in fnq until they pulled out last year.🍻
Any time a financial equity company takes over bankruptcy soon follows.
Jayjay, but why?
fnq…? funk?
@@dumdumbrown4225 FNQ... Far North Queensland
Is any country doing well these days?
Rwanda.
Switzerland and Singapore.
All by design.
But it's not deliberate yeah ok
Destroy disrupt food supply, that's what the USA let's go Brandon is doing and now Australia
Door Dash. Uber and Tesla powered truck will do it soon. Get rid of fuel. Solar and wind power will carry us into the future.
@Jake Demuss. We will still use fuel but the industry will use battery power.
@Jake Demuss My nothing is more then your and you who is worth less then nothing.
Don't worry Albo will fix the ecomony by pouring toilet water on it
@Jake Demuss or from Snowy 2.0 if he waits twenty years and throws another $100bn into the black hole
Coles and wooles has not keep prices down
The worker shortage is a joke. Get the bludgers off the dole and put them to work.
The company I work for brings in thousands of south Pacific workers each year to work on farms because Australians are job snobs and would rather sit on the dole than do farm work.
My job should not exist in a functional labour market.
smaller guys are long gone
Chalk up another business wollies/Coles have help wipe out. Jeez if only there workers had a decent union that wasn't handy capped by legislation th that could fight for their jobs.
Thanks johnny
So the trucks stopped and Australia didn't?
My whole life has been a lie😮
Yep !! Angry yet ?? OUR turn 4 some fun
@@Kelly-wf5ie Who makes up "OUR" exactly?
yes. every truck in australia is a scotts truck. 🤡
@@positivepawpaw7564
Well even if we want to limit it to Scotts the Scotts of Australia are doing fine. I have a brother Scott. He's doing great
@@bobhawke7373
From what I've seen of your comments Yes Your Whole Life is a Lie. 😆
Sounds like what their doing to me their not paying me for my work they don't give me credit or royalty's it's hard huh
Who is doing this to you? You are unclear.
That’s what happens when you sack all the Australian drivers and hire Indian ones instead.. just saying
🤣🤣🤣 we told you so , green policies (theories) are based on stupid indoctrination 🤣🤣🤣
Fox has a big hand in this the crook
Another taxpayer gone wait till there are none left
Someone isn't telling the truth here! There is plenty of money around it's just not being spread fairly.
I have a solution to this:
SMSF are running out of investment channels and experienced local drivers cannot raise the $300,000 to capitalise their own truck so nobody’s driving anymore.
1) Create SMSF bonds where a cash rich private fund can purchase a brand new Semi.
2) Let an at arms length driver take the truck and operate it and all that needs to happen is a contracted 8% return on net turnover for 5 years.
3) SMSF makes $150,000 sells the truck after term.
4) Local driver has a top wage, trucks are respected and well looked after, sector is profitable, the environment benefits and SMSF trustees get a rock solid return.
Nah, too simple and makes way to much sense
@@neverstopinthemiddleofahoedown Probably. Australian SMSF trustees are just ASX20 and residential property leeches.
Imagine the unlocking of all those billions for actual real economic growth requirements like buying new trucks so young blokes can get into the business without $300,000 debt obligations.
Crazy I know.
@@neverstopinthemiddleofahoedown BTW - don’t let anyone tell you there isn’t coin in trucking for owner drivers.
Absolute fucking millions are up for grabs if you own and operate. We don’t get out of bed unless we’re making a grand a day.
What is SMSF?
@@joelc9439 Self Mismanaged Superannuation Fiasco.
It’s this financial vehicle for MouthBreathers that think they can outwit their professional superannuation funds by “aving a go” at it by themselves.
Years ago the "PLAN" (CONSPIRACY) is to have 5 major players controlling everything. Fox, Toll, K&S...... and i can't think of the other 2 mentioned, but it has been coming for a while. I've been in this game for 31 years, and I've seen a lot.
Thanks ALBO SLEAZY!!!!