Joining the Australian Logistics Council just as the COVID drama befell critical supply chains in Australia and globally has brought to an already issues-rich environment another set of challenges according to Chief Executive Officer, Brad Williams.
Prime Mover: The freight and logistics industries have been largely under-recognised and under-appreciated until COVID and now the public are full of praise. Has there been a corresponding change in attitude from bureaucracies and governments?
Brad Williams: I think everyone gets it now and most people know how important it is to keep food and medicines on the shelves and fuel in the bowsers, so that’s a positive for the sector which has come out of the pandemic. It took a lot of effort to make that happen, but I do think that governments now have a much better understanding of the inter-connectivity of the logistics system and some of the challenges the sector has had and why it is so reliant on all the pieces fitting together. The AdBlue shortage was a classic example where the Commonwealth response to the crisis was built off the back of the preceding 18 months of experience with the sector and knowing what a key factor AdBlue was in keeping our trucks moving. They responded accordingly which is a good example of ‘they’ve seen, they heard, they’ve listened and they’re responding differently’.
PM: What other conclusions can we draw from the response to the pandemic?
BW: It put back focus on sovereign manufacturing capability and that’s not just a matter of our sector, it’s across the board. People are thinking differently about building some resilience into the system. The AdBlue situation was pretty drastic, and we came pretty close to people having to turn their trucks off. The response was a good example of governments and industry working together to solve a problem, which is quite refreshing.
PM: Can the multiple freight transport modes co-exist successfully and profitably or is competition between modes having a negative effect?
BW: From our perspective it’s about getting the balance right in terms of the freight task. The modal shift from road to rail is about improving the overall efficiency of the system and making sure that ultimately, we can meet that growing freight task which is expected to grow by 35 per cent over the next 20 years. In the urban context it may be as much as 60 per cent growth. We are continually looking at how we move that freight and our view is it’s not one at the expense of the other. If we’ve got an efficient rail network that will contribute to a more efficient road network because we’ll have less congestion on the roads. The key challenges in terms of modal shift, say, in the context of inland rail, are we’ve got to get all the pieces connecting so that the system actually works efficiently. The big challenge with inland rail is the connectivity with the Port of Melbourne and the Port of Brisbane. At this point in time that is still not resolved, although the Federal Government put a multi-billion dollar investment package on the table just prior to the election for a two-terminal strategy in Melbourne, which we welcomed.
PM: Are there too many industry groups struggling to get governments’ attention?
BW: I’ve worked in agriculture, mining, and the oil and gas sectors, so I’ve had involvement in many industry organisations over the years. All of us have a role to play, but from the governments’ perspective it’s important that we maintain consistency of message and consistency of voice. We are the only organisation where we represent across the whole supply chain. That gives us a unique perspective, but it doesn’t give us a monopoly. We work with as many other industry groups as we can to make sure we get the best outcome for our members. That might sound a little bit like marketing rhetoric, but in actual fact I genuinely mean that. I like a grassroots approach and interaction, and in this day and age it may seem slightly altruistic, but I still firmly believe in it. The freight and logistics sector has a very strong regional footprint and I’ve always admired regional and country communities for being so resilient and there is a lot we can learn from that.
PM What are some of the issues to be faced in the next few years?
BW: The geo-political tensions and global supply chain challenges are certainly still going to be around. It’s important to remember that as much as we rely on imported goods and exported goods, we are still only one per cent of the world’s container trade and in that respect, we are a price-taker not a price-maker. A big challenge, which is also an opportunity, is decarbonisation and transition to net zero emissions. The transport sector is well and truly on board but there are a lot of changes which have to happen. Another challenge is how we build resilience into our freight and logistics supply chains for situations like extreme weather events or the AdBlue shortage. How do we make the system better able to deal with the shocks? It’s an ongoing challenge which industry and government need to work collectively on. Leading off that is the constant challenge of how we build capacity into the system to meet the growing freight task.
PM: With the current low unemployment rate what can the wider industry do to attract labour?
BW: We need access to a skilled workforce and there must be opportunities for people to upskill as we head towards digitalisation, automation and robotics. There is a real opportunity for the sector to sell itself as a different career for people which they might not have considered in the past. We just don’t have enough drivers at the moment for our vehicles so how do we meet that? What are we doing in terms of migration and skills priorities as part of our migration system and who are we helping to upskill people? Again, there’s a role for both industry and government.
PM: Is there enough ‘big picture’ planning taking place?
BW: Something which is a bit of a sleeping giant is the planning and preservation of industrial land. The Greater Sydney Planning Commission has been doing some work recently on this and it is important because in a city like Sydney you’re constrained in terms of space because of the geographical nature of the Sydney basin. There is growing pressure for housing and all the things that go with it. If we are talking about 60 per cent growth in freight in our urban areas where are we putting the warehouses, where are we putting our empty containers when we need to stack them, how are the ports going to cope? That’s why places like Western Sydney airport and the Moorebank Intermodal Terminal are becoming increasingly important because there are less and less green field sites around. So how do we think differently about our warehousing? What can we learn from Europe and other places about how do we go about doing that? So, there’s a bit on the agenda and it’s an issues-rich environment.