Soaring Diesel Prices Push Alicante Hauliers into the Red

Diesel prices are skyrocketing in Alicante province, threatening the financial viability of hauliers who operate on thin margins. According to Fetrama, the province's leading road transport association, the cost of refueling a truck has risen by an average of €600 compared to last year. With fuel now accounting for about 40% of operators' costs, some companies are struggling to stay afloat.

Fetrama is urging the Spanish government to extend fuel subsidies and restore support to 20 cents per litre. The conflict in Iran and ongoing market disruptions have contributed to the escalating cost of diesel, pushing many businesses into critical financial positions. Some operators have already considered closing their businesses or alternative measures, according to Fetrama's general secretary, Antonio Gabaldón.

While only a small number have reached that point so far, Gabaldón warns the situation could deteriorate rapidly depending on fuel prices and government assistance. Fuel support for the transport industry has been reduced from almost 20 cents per litre to five cents, set to expire next week. The reduction comes at a crucial time, as the average profit margin in the industry is only around 5%, and all costs have risen sharply.

Gabaldón emphasizes that diesel now costs an average of €1.925 per litre, around 37% more than a year ago. Transport companies must pay for fuel upfront, but may not receive payment from customers for 30 or 60 days, leaving them financing rising fuel costs while waiting for payment. The increase in diesel prices now makes up approximately 40% of the average transport company's total expenditure, up from 25% to 30% a year ago.

Fetrama hopes the government will restore the subsidy to 20 cents per litre, but smaller operators are particularly vulnerable without stronger assistance or a significant decrease in fuel prices.