The Nigerian Association of Road Transport Owners (NARTO) has announced that its members will suspend operations from Monday, February 19, due to unsustainable losses.
The national president, Alhaji Yusuf Lawal Othman, stated that the decision was made after a press statement was issued from the association’s headquarters in Abuja.
The NARTO national president said, “We will have to suspend operations from Monday.
“We cannot continue to operate at a loss. Most people have parked. A lot more are going to park.
“But from the point of view of the association itself, we are going to suspend operations on Monday.”
NARTO members are struggling with high operating costs, particularly the difference between the freight rates they receive and the actual costs of fuel distribution.
The association has written letters to the chief of staff to President Buhari, the minister of Petroleum Resources, and other stakeholders, but these efforts have not yielded positive results.
The association’s president explained that the current freight rate of N32 per liter for transporting fuel from Lagos to Abuja was set during President Buhari’s tenure, when the dollar was N650. However, the current exchange rate is N1,615, making it impossible to operate at a profit.
He said, “Everybody is aware that all our consumables in terms of operation are not produced in the country.
“So, by virtue of the rate of dollars, every consumable has increased. But the freight they are paying us has been the same even during Buhari’s time.
“So how is that feasible? During Buhari’s time, the dollar was N650. Today, the dollar is now N1,615. The average freight from Lagos to Abuja is N32.”
Continuing, he explained that “What I mean by local, you load Lagos, you discharge in Lagos. And bridging, you load from Lagos, you come to Abuja. Lagos to Lagos, we are paid N120,000.
“AGO alone to distribute fuel within Lagos is N140,000 because it is N1,400 per litre. So, they give you N120,000 and you spend N140,000. So, how do you want to operate? “Talk less about the cost of vehicles, cost of loading, driver’s allowance. That is for local. For bridging Lagos to Abuja, they gave us N32.
“If you have a truck of 40,000 litres, you are talking of N1,280,000-N1,216,000. Less 5% of the amount of N1,280,000 Withholding Tax N64,000. Less 55,000 loading expenses and 15,000 driver allowance. Total expenses N134,000 while balance is N1,146,000. AGO is N1400 for 900 litres, totalling N1260,000.
NARTO members are also facing challenges with the cost of vehicles, driver allowances, and the cost of diesel, which is used to transport fuel.
The association’s president stated that the cost of a new truck head and tank is N95 million, while a used one costs N50 million.
There is a total loss of N114,000.
The diesel that you use from Lagos to Abuja is 900 litres.
“So when you use 900 litres at 1,400, that will be N1,260,000. So it is by far more than what are paid.
“Meanwhile the cost of a new truck head and tank is N95 million and the used one is N50 million. So imagine the amount invested on each truck?”
