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Trudeau signals support for Canadian trucking — and some carriers really need it

Canadian prime minister makes clear that trucking companies can qualify for 75% wage subsidy as some carriers struggle far from the robust volumes of essential consumer goods.

A driver from Rosedale Transportation Group makes a delivery to a carpet store in Toronto on Monday, March 30, 2020. (Image: Nate Tabak/FreightWaves)

As Canadian trucking companies face an anticipated plunge in freight volumes, Prime Minister Justin Trudeau announced on Monday a 75% wage subsidy would extend to any business facing a revenue plunge of at least 30% because of the COVID-19 pandemic.

Speaking during his daily news conference, Trudeau made clear that trucking companies — along with any other business in Canada — could qualify for up to C$847 per employee per week. He highlighted Quebec trucking and logistics company Energy Transportation Group as a potential beneficiary, saying the subsidy would help ensure it “can keep moving essential goods like food and toilet paper.”

Canadian Prime Minister Justin Trudeau highlighted Quebec-based Energy Transportation Group during a news conference outside his home in Ottawa on Monday. (Video: Office of Prime Minister Justin Trudeau/YouTube)

While carriers like Energy continue to enjoy robust demand for vital consumer goods, others already are hurting. Carriers specializing in auto parts and oil services have it the worst, with fleets completely idled and layoffs hitting drivers and other employees.

Auto parts carrier: ‘We’re down until they come back up’

Verspeeten Cartage in Ingersoll, Ontario, temporarily laid off its roughly 110 employee drivers. The company hauls parts for General Motors, Ford, and Fiat Chrysler, all of which halted their plants’ operations in North America.

“We’re down until they come back up,” Verspeeten President Scott Verspeeten told FreightWaves.

He said the company is looking into the wage subsidy and whether it could rehire any of its employees even if they won’t be working. Meanwhile, he said, Verspeeten has financial reserves to last several months.

“We’re OK for now, and I’m sure we’re better off than some,” Verspeeten said.

The Outbound Tender Volume Index – Canada (OTVI.CAN) on FreightWaves’ SONAR platform was 15% off its March 19 high as of Monday as trucks move less freight in the country.

In St. John, British Columbia, D.R.S. Energy Services is contemplating what to do with its 45 employees and 27 trucks.

D.R.S. serves the energy sector in British Columbia and Alberta, where the historic plunge in oil prices is having a catastrophic impact on the industry.

“We were surviving until two weeks ago. Now I’m thinking we’ll be down for three months,” President and owner Sandy Beech told FreightWaves.

Beech and his business partner are also looking into the subsidy and other government assistance as its trucks sit idle. He has yet to lay off the drivers but did cut back the maintenance shop to three days per week.

Barring a return to demand for hauling for rigging equipment and other oil services, Beech hopes the provincial government will grant him permission to begin mining a gravel pit. The project, delayed by more than a year, would allow the company to extract and haul gravel.

In Quebec, Energy Transportation Group CEO Shawn Girard said his company has no need to apply for the wage subsidy as demand for essential goods remains strong. But he found Trudeau’s message reassuring.

“It’s comforting,” Girard told FreightWaves. “We don’t need it right now. But will we need it a month from now?”

One Comment

  1. Stephen Webster

    The energy sector including trucking for it needs some help. The other trucking companies should be limited to a loan interest free for one year to a maximum of $100,000 per company plus up to $60,000 per company for a maximum of of 6 months insurance costs. They should also give a grant of up to$60 per night for truck drivers to isolate between loads to a maximum of $10,000 per company for the rest of this year. Trucks can be parked and truck drivers sent home.

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Nate Tabak

Nate Tabak is a Toronto-based journalist and producer who covers cybersecurity and cross-border trucking and logistics for FreightWaves. He spent seven years reporting stories in the Balkans and Eastern Europe as a reporter, producer and editor based in Kosovo. He previously worked at newspapers in the San Francisco Bay Area, including the San Jose Mercury News. He graduated from UC Berkeley, where he studied the history of American policing. Contact Nate at [email protected]