Freight Industry: "No More Introduction of Mandatory Freight Rates"

Urgent KITA Meeting on the 19th
"Even with the Introduction of the Standard Freight System,
Industry Should Be Left to Self-Regulation"

[Asia Economy Reporter Moon Chaeseok] Cargo owners' representatives emphasized on the 19th that the past method of forcibly setting freight truck rates should not be repeated. This came just one day after the government pushed for changing the safety freight rate system, which was the cause of last year's strike by the Korean Confederation of Trade Unions Public Transport Workers' Union Cargo Solidarity Headquarters (Cargo Solidarity), into a standard freight rate system.

The Korea International Trade Association conveyed the cargo owners' claims at the 'Cargo Transport Market Improvement Cargo Owners Meeting' held at the Trade Center in Samseong-dong, Gangnam-gu, Seoul on the same day. The meeting was held to hear cargo owners' opinions on the market normalization plan recently proposed by the Ministry of Land, Infrastructure and Transport. Ten companies participated.

At the meeting, cargo owners' representatives said, "Even if a system like the standard freight rate system is temporarily introduced before the market functions efficiently, it should be voluntary for the industry to refer to, not a forced rate," adding, "If market entry regulations are lifted, truck owners' costs will decrease, and overall income will increase." They argued for the early abolition of the business-use freight truck permit system and supply-demand adjustment system.

Kim Byung-yu, Head of Member Services Division at the Korea International Trade Association, speaking at the 'Cargo Transport Market Improvement Shipper Meeting' held on the 19th at Trade Tower, Samseong-dong, Gangnam-gu, Seoul.
[Photo by Korea International Trade Association]

Kim Byung-yu, Head of Member Services Division at the Korea International Trade Association, is speaking in the presence of 10 participating shipper companies.

They raised concerns about the composition method of the freight rate committee included in the Ministry of Land, Infrastructure and Transport's plan. Cargo owners worried, "The number of truck owner and carrier representatives is greater than that of cargo owners, so cargo owners' negotiating power will inevitably be weakened." They also pointed out that the three-year sunset introduction measure for the standard freight rate system is ambiguous. Cargo owners said, "There is no alternative on what criteria will be used to determine the sunset after three years," and criticized, "A similar situation to the current one could occur again then."

They insisted that the issue of cost calculation necessary for setting truck owner freight rates should be continuously discussed with the government. Cargo owners said, "Although some items such as mandatory submission of Digital Tachograph (DTG) records are specified in the Ministry's plan, there is no concrete alternative for determining the cost level," adding, "The cost calculation method should be disclosed to reach a consensus among stakeholders."

Kim Byung-yu, Head of Member Services at the Korea International Trade Association, said, "Although market improvement plans have been discussed several times over decades, market entry barriers have only been built up under the pretext of protecting the supply side," and predicted, "If the transport market structure is not changed, similar problems will repeat." Kim added, "In the long term, alternatives that encompass both demand and supply to create a market should be proposed."

This content was produced with the assistance of AI translation services.