Will the cut in fuel duty make a difference?

On Wednesday 23rd March the Chancellor, Rishi Sunak, announced in his Spring statement a cut to fuel duty of 5p litre, leading to a total cut of 6p/litre at the pumps. The cut comes into effect at 6pm on 23rdMarch and will last for 12 months.

This was at a time when the average price of diesel was hitting £1.80/l (RAC fuel watch). Over the last 12 months, the cost of Diesel has now risen by almost 50p/litre, with most of this rise being seen in just the last few weeks.

While the cost of crude oil could go up further still, having hit a record of $127.5 on 8th March it has been fluctuating around $110/barrel since, (and is currently sitting at $121 at time of writing), it is expected, due to the Russia-Ukraine war and supplies being volatile, that fuel prices at the pump will remain high for the foreseeable future.

This will only force more companies to consider electric vehicles for their deliveries as the move to electric becomes an easier decision to make due to the potential cost savings. But the current supply shortage of microchips is creating delays in the supply of electric vehicles with potential wait times of 6 to 18 months for some vehicles.

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Companies, therefore, need to do what they can now to mitigate the increasing fuels costs, deliveries need to be at full capacity, lorries need to be driven efficiently and carefully and delivery routes need to be the most efficient, which is not always the shortest route.

Even if only one extra delivery can be added to each lorry or van, or a short distance took off a delivery route, over several days and all the vehicles in your fleet this can make a huge saving. Delivery route planning software is the key, introducing a delivery scheduling and route optimisation solution that works both now with Diesel and in the future with electric-powered vehicles is the answer. Delivery capacity can be increased and routes created that are more efficient, leading to overall savings.

Contact us to discover more about the Descartes solutions that are right for your business and its needs.