Most drivers, who actually pay for their fuel, take notice when their weekly trip to the service station jumps, in a space of a few months, from $45.00 to $70.00 - and of course that’s only for a moderate usage of a reasonably economic motor vehicle.
If, for example, you have a 4WD and/or travel a fair distance each day the numbers involved can be many times this amount and hikes of $100.00 per week or even more are becoming increasingly common.
Unfortunately that’s only the beginning of our problems with other associated costs of higher priced fuel hitting our back pockets in a multitude of differing ways.
Most basic food staples all have a significant transport component. Often items not only travel from the original producer to a processing plant but from there go on to a distribution centre of some kind before being finally delivered to a retail outlet. And some items have a lot more steps in their distribution chain.
Each time transport is involved the increased cost of fuel is added together with the usual overhead percentages plus any related government charges and taxes. In fact, there are very few items in our modern lifestyles that don’t include some transport / petrol cost component.
Big ticket items such as air travel are already heading north and some companies are stepping up the use of web based conferencing tools and re-evaluating the traditional shuffling of executives between branch offices on a weekly basis. A decrease in
face-to-face selling and a renewed emphasis on phone based telemarketing is also being considered by many organisations.
Perhaps most insidious is the slowing of the economy with previously disposable dollars now being re-deployed to cover the relentless on-going rise in fuel costs. A slowing retail sector in turn impacts on other associated areas and has an increasingly negative effect on business confidence and overall spending patterns.
In an economy where growth is stalling corporate managements inevitably focus on cost reduction as a means to achieve their budgets and this type of strategy can set in motion further initiatives, such as outsourcing overseas, which either compound the problem or simply move the pain elsewhere.
To try and paint a picture of improving our ecology or environment through the reduction in fuel consumption may seem attractive to some of our more idealistic central planners and ‘green’ economists but, realistically, thinking about longer term solutions does not address the very real issue of just surviving the present fuel crisis in all its various permutations.
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