The Nigerian Association of Road Transport Owners (NARTO) has declared its intention to suspend operations starting Monday, February 19, citing unsustainable operating costs.
The decision was communicated by the National President of the association, Alhaji Yusuf Lawal Othman, in a press statement issued from Abuja.
Othman emphasized that the decision to suspend operations was reached due to the disparity between operating costs and revenue. He lamented that the association’s members have been operating at a loss, making it financially unviable to continue their activities.
Explaining the rationale behind the decision, Othman highlighted the significant increase in operating costs compared to stagnant freight rates. He noted that despite the escalating costs of consumables and the exchange rate, the freight rates have remained unchanged, posing a severe financial challenge for NARTO members.
The association’s efforts to seek intervention from relevant stakeholders in the federal government and the industry have reportedly yielded no positive outcomes. Othman revealed that letters detailing the challenges faced by NARTO members were sent to key government officials and industry regulators, but no response was received.
Analyzing the market dynamics, Othman underscored the discrepancy between current operating costs and freight rates. He pointed out that the freight rates have remained static, despite a significant increase in the cost of consumables and the exchange rate.
Othman highlighted the financial implications for NARTO members, citing examples of operational expenses exceeding revenue. He emphasized that the disparity between expenses and revenue has made it financially untenable for members to continue operations.
In conclusion, Othman reiterated the association’s decision to suspend operations from Monday until a resolution is reached to address the financial challenges faced by its members. He called for urgent intervention from relevant stakeholders to address the unsustainable operating costs plaguing the transportation sector.
