The Nigerian Association of Road Transport Owners (NARTO) has pledged to halt operations on Monday.
Yusuf Lawal Othman, the country’s president, said this in a press release from Abuja. He pointed out that the document is an official declaration from the association’s main office stating that starting on Monday, members would be parking their vehicles.
He stressed: “Why? Because what we spend on operation is more than what we get in total: both in local and bridging”.
He asserts that the members have been functioning at a loss, and that their ability to withstand the losses is now exhausted.
NARTO’s National President said, “We will have to suspend operations latest from now till on Monday.
“We cannot continue to operate at a loss. Most people have parked. A lot more are going to the park.
“But from the point of the association itself, we are going to suspend operations on Monday.”
The President stated that despite NARTO’s attempts to seek intervention from all key stakeholders in the Federal Government and the industry, positive outcomes have not been achieved.
Othman disclosed that the association has written letters addressing the challenges of the exorbitant operational costs to various officials, including the Chief of Staff to President Bola Tinubu, the Minister of Petroleum Resources, the Director General of the Department of State Services (DSS), the Chief Executive Officer of the Nigerian Midstream and Downstream Regulatory Authority (NMDPRA), the Group Chief Executive Officer of the Nigerian National Petroleum Company Limited (NNPCL), and the Marketers.
“We have written letters up to the level of the Chief of Staff. We have written to the Honourable Minister of Petroleum Resources (Oil) I will send you a copy,” he added.
“We have written to DG SSS. We have written to the G
He stressed that despite the notification to the above stakeholders, “No response.”
Examining the market conditions that members have faced for many months, he noted that the freight rates remain unchanged from the time President Muhammadu Buhari was in office.
He highlighted that the N32 freight rate from Lagos to Abuja, which was established when the dollar was valued at N650, persists even though the dollar now stands at N1,615.
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 consumables 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, dollar was N650. Today, dollar is noe N1,615. The average freight from Lagos to Abuja is N32.”
Continuing, he explained: “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 of 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 than 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. 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 is paid.
“Meanwhile the cost of a truck New truck head and tank is N95 million and used is N50 million. So imagine the Amount invested on each truck?”