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The Current Challenges and Future Outlook for Road Haulage in Thailand

The Current Challenges and Future Outlook for Road Haulage in Thailand
Amolrada Thamrongvoraporn

Over the years, Thailand has transformed itself from being a predominantly agriculture-intensive exporter to now becoming a well-known exporter of industrial goods. The country has become an attractive destination for industrial producers to establish production plants, especially for automotive and electronics parts. Transportation between production plants and the rest of the points along supply chains rely heavily on land transport and road haulage. In particular, the road haulage sector faces many challenges that range from road safety conditions, to the shortage of skilled drivers. To establish a strong foundation for future growth, the sector must face these challenges head-on and find solutions to them.

We recently had the chance to speak with two container depot and land transport executives from Siam Shoreside Services Ltd. (Siam Shoreside), Mr. Matthijs Bastian van den Heuvel, Managing Director and Mr. Somkuan Roungsuwan, General Manager, Transport. The two shared with us their expert insights into the challenges faced by the road haulage sector, as well as ways to develop services and operations to better prepare for the future.

Road Safety Issues

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Mr. Matthijs Bastian van den Heuvel, Managing Director, Siam Shoreside Services

While Thailand is still experiencing a period of economic growth, the logistics industry is under pressure while trying to expand its own capacity. For land transport, especially the road haulage sector, roads are essential to the operation and a limiting factor at the same time. Unsafe road conditions and no clear designated truck stop areas can leader to a greater risk of road accidents and delays. Mr. van den Heuvel commented that, “The road leading up to Laem Chabang Port has improved greatly in recent years. Although it is not yet completely finished, the renovated roads have already helped save a lot of transport time. Regardless, there are other routes in Thailand that will need the same type of improvements to allow for better transport times and less risk, such as the roads around the Lat Krabang Inland Container Depot (Lat Krabang ICD) or the roads within the Laem Chabang Port area. The road conditions of these routes must be improved to expand the capability of supporting the ever-increasing capacity of the port and the volume of containers. Unsafe road conditions ultimately lead to delays and an increased risk of accidents.” Both Mr. van den Heuvel and Mr. Somkuan agreed that this is where the industry could use the help of the government. By improving road conditions on truck routes and creating properly designated truck stops aids not only the logistics industry, but everyone who shares the roads.

Additionally, a challenge many Thai road haulage operators have come to face is adapting to many international standards and regulations that have become the norm in service. Many major operators of land transport have set the standard for safety and services, and many local operators may find themselves at a disadvantage against a larger or a transnational operator with more strict and stern regulations. “An equally troubling challenge is when the local operators find it difficult to adapt to the new safety and service standards in the industry. With the introduction of international standards by many larger players in the industry, many local operators have yet been able to catch up and attain these same standards. The new norm can include the uniform of drivers, regular truck checks or regular physical checks for drivers at the start of each trip. While all mentioned measures are important, we still see some local operators at a disadvantage while trying to adapt to them. This is especially so when they now compete with transnational operators who have started their businesses in Thailand, and have become their competitors. This is an issue which we would like more people to consider,” said Mr. Somkuan.

Thailand will continue to develop itself into an industrial nation, and we’re seeing more production plants popping up in provinces further away from Bangkok. This will drive the demand for land transport and means that there’s still a bright future for the road haulage sector with a change in the way it operates to answer to the government’s plan for intermodal logistics infrastructure.

Mr. Matthijs Bastian van den Heuvel, Managing Director, Siam Shoreside Services

Driver Shortage Against a Rising Economy

Mr. Somkuan Roungsuwan, General Manager, Transport, Siam Shoreside Services

Mr. Somkuan Roungsuwan, General Manager, Transport, Siam Shoreside Services

A different kind of challenge the road haulage sector is facing, and will need a sustainable solution for in the long run, is the shortage of skilled drivers. One of the factors that has led to this shortage is the new norm on safety, especially a rule where no passengers are allowed in the cab of the truck. Mr. Somkuan explained the relationship between this rule and the shortage of skilled drivers. “Originally, the road haulage driver career in Thailand was passed on from one generation to the next. The knowledge and skills were usually taught when drivers were allowed to have passengers. They would take their families with them on the trips, so the skills were taught from fathers to sons. With the new installment of the safety norm that doesn’t allow any passengers, this tradition is being abolished. Continuously, the number of skilled drivers is getting smaller. This works against the industry along with the fact that many Thai people tend to not prefer the career.” Mr. van den Heuvel added that the same challenge is being faced by the logistics industry all over the world, evidently from an increase in the drivers average age.

Furthermore, Mr. Somkuan talked about the difficulty in sourcing for potential drivers because of the small number of truck driver schools that still exist in the country. One of the existing schools, which belongs to the Department of Land Transport (DLT), is only open for class when there is a sufficient number of prospective students. Siam Shoreside has stepped in and has offered to lend the school several trucks to assist with teaching classes and has agreed to consider drivers who passed DLT’s examination. Many solutions are being experimented with to fix the shortage of skills drivers around the world. In the more technological advanced areas, people are beginning to turn to technology advancements, such as the implementation of Advance Driver Assistance system or self-driving trucks.

Competition-Driven Tech & Knowledge Implementation

Another factor that affects the land transport industry and its competitive dynamics, is the change in fuel prices. Players in the road haulage sectors must complete fiercely in terms of service price while the fuel price stays low. From Siam Shoreside’s point of view, competing by lowering prices is not a sustainable way to win over clients. Rather, competing by the quality of services is a way to create a loyal client base. A vital way for an operator to provide better services is to arm oneself with safety innovations and well-trained workforce. In terms of safety innovations, Mr. van den Heuvel explained, “Siam Shoreside has always been interested in installing a dashboard camera (dash-cam) in our trucks. We’re not only interested in a dash-cam that faces the road, but also the ones that look inside the compartment at our drivers with a facial recognition feature. We’ve looked at such technology from different companies to find the one that fit our needs the most. Some of the software we’ve looked at can recognize 60 different facial expression, detected from the movement of the driver’s eyes, mouth, and cheeks. It works to recognize if the driver is getting tired or sleepy. Once a driver’s face shows the sign of sleepiness, an alarm will sound in the compartment as a warning, and will also sound an alarm at our control center. Some can even memorize the pattern of each driver’s facial expression, and we will implement this innovation for the safety of both our drivers and people who share the roads with them.”

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In terms of investing in their team members, Siam Shoreside has invested in safety training, and chooses to do so for all employees regardless of their post. The main purpose of the training is to create a sense of duty in intervening and reporting any risky situations. Mr. Somkuan elaborated, “For our facilities, we train all of our employees in Safety Leadership Training. The course aims to arm all our employees with the courage and skills to intervene and help to prevent accidents when a potential risk is sighted, as well as reporting any accident-prone situation around the facility. Thai people, by nature, tend to avoid pointing out a situation in a straight forward manner; this training is done to directly address this habit for better safety measures that apply to all of our team members.” For truck drivers, the company has an annual Defensive Driving training course that all drivers must take part. “Our drivers are trained and retrain on the yearly basis on Defensive Driving with specialists we specifically invite for the course. We also offer safety training from the insurance aspect, which is a course where we invite an insurance specialist to train with our drivers. As a company, we invest a lot into equipping our team members with the right knowledge and skills” said Mr. Somkuan. Siam Shoreside’s idea of safety responsibility does not only involve just its team member or the transported cargo, but also the safety of everyone who could be affected by their operations.

Originally, the road haulage driver career in Thailand was passed on from one generation to the next. The knowledge and skills were usually taught when drivers were allowed to have passengers. They would take their families with them on the trips, so the skills were taught from fathers to sons. With the new installment of the safety norm that doesn’t allow any passengers, this tradition is being abolished.

Mr. Somkuan Roungsuwan, General Manager, Transport, Siam Shoreside Services

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Adapting to the Future

Mr. van den Heuvel and Mr. Somkuan share the same outlook for the future of the road haulage sector. Both agreed that the business model must change and adapt to the infrastructure plan that the Thai government has invested in for the sector to strive in the future. One of the planned project that has been carried out is the building of rail network that will spread out its reach to many industrial zones in different parts of Thailand. However, the expansion of the rail network does not mean that the road haulage sector is no longer needed. On contrary, there will be even more demand for road haulage because of the growth of both the population and the connectivity of businesses within the region. “Thailand will continue to develop itself into an industrial nation, and we’re seeing more production plants popping up in provinces further away from Bangkok. This will drive the demand for land transport and means that there’s still a bright future for the road haulage sector with a change in the way it operates to answer to the government’s plan for intermodal logistics infrastructure” said, Mr. van den Heuvel.

Logistics
Amolrada Thamrongvoraporn

Amolrada Thamrongvoraporn is a Thai Content Writer for Airfreight Logistics and Logistics Manager, and an avid people-watcher/flâneur. She enjoys discussion about social dynamics, modern philosophy, movies, and cat videos. She's also a big fan of raccoon gifs, ghostly stories, as well as rock music from the 60s through the 80s.

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