Exploding The Lorry Driver Shortage Myth In Malaysia
The unnoticed 'elephant in the room' of lorry driver shortages in Malaysia is the inefficient running of empty lorries on any given day reducing the number of lorry drivers available to work.
For years journalists have listened to every word emanating from the great and the good in the Malaysian land transport and logistics private sector complaining of lorry driver shortages but I am yet to see a journalist really question the reasons for their complaint. Surprisingly a researcher does not have to dig too far to reveal the inefficiencies of the use of lorry drivers that really explodes the lorry driver shortage myth that has been perpetuated in Malaysia.
The Malaysian land transportation sector is very stuck in its methodology and in fact the modus operandi of the larger logistic players is (from a business perspective) to be admired. Their operations are designed to protect their margins at all costs and they are very good at this.
Two simple questions posed to large transportation companies will open a can of worms that they do not openly discuss:
1. What percentage of your fleet suffer empty backloads on delivery journeys above 100km?
2. What percentage of your total operation suffer empty backloads on delivery journeys above 100km?
The answer to the first question invariably was below 5% empty backloads.
The answer to the second question was that they do not record this data because many deliveries are carried out by haulage companies on their approved list of contractors.
The inevitable next set of questions focuses on their network of outside sub contractors they use to deliver goods, and, of all the large companies I have spoken with I am yet to discover a large haulage provider who does not tap into this pool of contract hauliers.
One of the most damning answers we received was the rationale of choosing which deliveries to give to contract hauliers.
Large transportation companies only use their own fleet when they know the likelihood is high of achieving a backload and on some routes they give all deliveries to contract hauliers.
The obvious consequence of this scenario is the smaller haulier with less resources is then trying desperately to get a backload and they are rarely successful.
An example scenario:
Large logistics company 'A' requires 10 lorries to collect goods from their depot in Selangor and send them to their depot in Penang for further distribution. If they only have goods to be sent from Penang to Selangor (return journey) that will fill 4 lorries then they will only send 4 lorries from their fleet to Penang, the remaining 6 lorries will be chosen from their list of approved haulage contractors to deliver to Penang.
There is irony in the above scenario because there will be a logistics company in Penang facing the same dilemma on the same day and sending contract hauliers to deliver goods to Selangor for which they have no return load.
Awareness and a mechanism in the form of an independent logistical haulage information exchange is all that is required to rectify the inefficient use of so many drivers so more are available on a day to day basis.
The above scenario is very typical of day to day running of a land transportation operation in Malaysia and after our initial backload research this was the driver behind the questions we asked in the Transport4u published research paper on empty backloading in Malaysia.
Two of the questions we added to the empty backload survey were these:
1. Did you ever do sub-contract work for larger Co?
2. Why do you choose not to do sub-contract work to larger Co’s?
The results from these two questions revealed that 93% of the small and medium sized hauliers had previously done sub contract work for larger players but a staggering 51% of these refuse to work as sub contractors to larger players, while 7% made the decision to never work as a sub contractor to large transportation companies.
The majority answers we received from the 51% who now refuse to work as a sub contractor were the margins are very small so if no backload we are lucky to break even or make small profit. Payment problems with some small hauliers having to wait many months for payment was the other reason cited.
This is how the Malaysian land transportation system inefficiently uses (and in some cases abuses) its pool of lorry driver resources.
A further irony is that it is very achievable (if there is a will to create the required awareness) to reduce the number of kilometers driven by lorries every day in Malaysia without impacting the volume of goods delivered.
You can imagine the benefits:
- Less traffic jams
- Less GHG's released into the atmosphere
- More lorry drivers available daily to deliver goods
If there was more done to help this large group of small and medium sized hauliers to get a back load they would be far more receptive to returning to the larger players approved contractors lists, this has an immediate effect in increasing the number of drivers available on any given day.
Empty return loads is a worldwide issue that is inescapable but can be reduced if managed correctly and awareness is created.
The UK Ministry Of Transport has long recognised the adverse effect of empty back loads in the UK logistics industry. Since the 1980's they have carried out annual research into empty return loads.
As a result of this research awareness was raised throughout the industry and over a period of 16 years a reduction from 33% to 29% empty back loads was achieved by the rise in the number of load matching services (haulage exchanges) and hauliers making greater efforts to obtain back loads.
Another lorry driver shortage issue that larger land transportation companies avoid discussing is the economic one. So many transport associations around the world complain of lorry driver shortages and whether they are true or not is of little consequence. It is made known for economic reasons, they are always looking to increase the numbers of drivers available because increased competition for driver jobs will force labour costs down.
The Ratio Of Lorry Drivers To Goods Vehicles
In strategy Paper 14 of the 11th Malaysia Plan, point 14.27 highlighted the ratio of drivers to goods vehicles as 1:1.5, when you consider that the mighty USA has 3.5 million licenced truck drivers and 15.5 million trucks it makes you wonder about the differences in the efficient use of their driver pool compared to the Malaysian private sectors inefficient use, albeit with Malaysia having a more favourable ratio of drivers to lorries.