Strategy

Fixing freight: establishing freight performance in Australia

24 Apr 2018
Description

Australia is a trading nation. Almost every facet of the Australian way of life relies on our capacity to move goods to, from and around the country. Whether it is moving product from farms or mines, transporting cars from ports to dealerships, or servicing our major global cities with building materials, groceries or smart phones, we are reliant on complex supply chains largely hidden from every day view.

Australia’s freight operators and infrastructure providers have excelled over recent decades in extracting more efficiency and capacity from our existing logistics networks. Innovations like larger trucks with multiple trailers, and automation at port terminals have meant we can do more, with less. But with a 26 per cent forecast growth in freight over the next 12 years, these isolated, incremental improvements will be insufficient.

The strains on Australia’s freight networks, and in turn our economy, are already beginning to be felt. A range of macro indicators, coupled with feedback from customers and industry, show that Australia is falling behind on freight.

According to the World Bank, Australia underperforms other first world economies on logistic performance, sitting between Ireland and South Africa in 19th position.

A further measure for ease of ‘trading across borders’ places Australia 95th globally, this much lower than our 2006 ranking of 23rd. The 95th rank places Australia, at the bottom of our peer group of highincome countries.

These declining indicators of Australia’s global competitiveness are not theoretical or remote. They expose an everyday reality for Australian producers, exporters and consumers. They are indicative of the higher costs and longer lead times that make Australian businesses less competitive, and see Australian consumers pay higher prices.

These high level indicators only describe a snapshot of the problem. There is limited reliable data available to accurately understand where the pinch points, bottlenecks and breakdowns are across the supply chain. Along with a lack of insight about where constraints emerge, we have little information about how costly they are, meaning a policy or project response is often reliant on intuition rather than evidence.

Publication Details
Identifiers: 
isbn: 
978-0-6483219-0-3
Language: 
License Type: 
CC BY
Published year only: 
2018
60
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