Wettenhalls collapse lays bare problems in the transport industry

More than 450 workers are not returning to their jobs today, as transport and logistics company Wettenhalls collapsed on Friday afternoon.

The business has been operating for almost 90 years and has a turnover of approximately $120 million per annum and has 14 sites nationally.

BDO administrators Luke Targett, Rachel Burdett-Baker and Dennis Turner have been appointed as voluntary administrators.

Independently, Ferrier Hodgson partners Brendan Richards and George Georges were appointed receivers and managers of the Wettenhalls business on Friday, January 25.

Richards was expected to be exploring options for an urgent sale of the business this week.

In a media statement, Richards said he was assessing the business over the long-weekend and would have a “clearer picture of the future of the business” this week.

But Ferrier Hodgson told SmartCompany this morning that no new information was available to be discussed on the collapse following the weekend.

The collapse of Wettenhalls comes as the transport industry is already struggling, with big businesses such as Coles and Woolworths driving their profit margins down.

Victorian and Tasmanian state secretary of the Transport Workers Union, Wayne Mader, told SmartCompany profit margins were being forced “tighter and tighter”.

“The ability for people to ride things out has been considerably reduced,” Mader says.

“Of course if the retail operators continually demand lower and lower freight prices, it in itself puts pressure on safety and working conditions.

“There is only so much transport businesses can do with operating costs – they can only reduce capital costs by so much,” he says.

In turn, Mader says this puts pressure on transport companies to act more like big chains, putting pressure on individual workers to work longer hours for less.

“Transport companies are making people work longer and drive for longer hours, once again bringing the safety issue into play.

“Owner-drivers have to delay maintenance just to try and make ends meet.

“This is where workers are directly affected,” he says.

Mader says with the state of the industry, it is possible there will be more collapses of businesses like Wettenhalls because of increasing financial pressures.

“Transport companies in desperation will continue to try and trade but if they’re not getting a proper return, there will be more to collapse.

“Australia can’t afford for the transport industry to collapse… the transport owners can weather the storm, it will be the workers who are the worst affected.”

Rumours of the collapse started when drivers were told not to come into work on Friday.