First ever Waikato & Bay of Plenty Freight Action Plan
Posted: 30-Jun-2022 |

The freight and logistics sector is already one of the key drivers of economic development in our region and we anticipate strong future growth as freight volumes increase and key industry investments come onstream in the coming months and years.

Several key trends were identified by stakeholders. These trends highlight the key external factors that are likely to have a profound impact on the freight and logistics sector in future.

As the population increases, congestion is likely to grow and freight flows are likely to be altered. it is predicted that there will be an increase in freight growth of ~45-65% between 2020-2030. Larger freight carriers increase efficiencies but can have flow on consequences for infrastructure. All transport modes are experiencing a drive towards larger cargos as a means to increase efficiencies. 

Some selected examples at a national level include, Growth in use of high productivity motor vehicles (HPMV) trucks. In 2012, 2% of shipping vessels exceeded 4,000TEU (twenty equipment unit), while in 2021, 63% exceeded this level.

In 2019, KiwiRail added an additional 15 wagons per day to transport logs from the Wairarapa to CentrePort. This change increased the quantity of transported freight from 267,000 tonnes to 370,000 tonnes, increasing capacity by approximately 40%.

Larger carriers present efficiencies but also put pressure on existing infrastructure. For example, larger trucks can increase wear and tear on existing road networks and larger ships necessitate increased capital expenditure at seaports.

In terms of asset management, stakeholders highlighted the poor conditions of the State Highway over the Kaimai Ranges and SH27 as ‘hot spots’. It is estimated that 9,000 vehicles travel over the Kaimai Ranges every day and 1,300 of these are heavy vehicles. Due to its terrain, the trucking route over the Ranges is costly and is known to have large safety issues. SH27 is also recognised by many as a challenging road due to the deterioration of the pavement and congestion.also acknowledged that some freight that is currently transported by road could sensibly shift to rail if key barriers (perceived and real) were addressed. 

Recently, 37% of industry operators reported a shortage of truck drivers and within the next five years, it is expected ~20% of truck drivers will retire / leave the sector. Throughout the transportation sector there is a large skill shortage of manual labour, and the shortage of truck drivers in particular is of increasing concern.

To address this shortage, Ia Ara Aotearoa Transporting New Zealand has collaborated with various parties to develop a programme called Te ara ki Tua | Road to Success. The programme connects potential truck drivers and employers to enable trainees to complete a 12-month training course with a mixture of online and paid on the job training. Launched in April 2021, the initiative relies on employers getting involved and taking on new trainees. This programme was strongly supported by stakeholders interviewed.

At present, Immigration New Zealand has placed truck drivers on the construction and infrastructure skills shortage list and the skill level classification list whereby overseas workers can apply for an essential skills temporary work visa. However, for the construction and infrastructure skills shortage list, the visa is limited to those who will choose Canterbury as their principal place of work. These settings should be continually revisited to enable the supply of truck drivers to meet demand – and that a Waikato and Bay of Plenty regional lens could be considered.

Drive towards aggregation. Aggregation involves the combining of multiple services to maximise utilisation. Aggregation can support the reduction in carbon emissions, costs (particularly for smaller organisations) and provide a means to grow in scale. For example, collaborating inter-regionally and across organisations to manage the use of trucks would reduce empty running or the use of partially full vehicles. Subsequently, national carbon emissions and congestion would also decrease. 

Technological change has the potential to enhance efficiencies and sustainability. Electric heavy vehicles can be accessed in the New Zealand market with the first hydrogen powered fuel cell truck having arrived in New Zealand in November 2021 and the first hydrogen filling station in operation at the Ports of Auckland. However, growth in electric heavy vehicles and hydrogen powered fuel cell trucks will require significant investment in infrastructure and will pose policy and regulatory challenges that need to be considered.

‘Green' hydrogen is produced by separating water into oxygen and hydrogen using renewable electricity. This process is zero carbon, and with the only emission at the point of use in a fuel cell is water vapour. However, there are still a possibility of nitrogen oxide emissions (NOx) release due to combustion. Due to the extensive renewable energy sources in New Zealand, there is a great opportunity to use ‘green’ hydrogen as a zero-emission alternative in all modes of transport.

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