"Improvement Needed for Truckers-Shippers Win-Win System After Safe Freight Rate Sunset"

'Logistics Industry Win-Win Development Shippers Meeting' on the 5th

At the 'Shippers' Meeting for the Win-Win Development of the Logistics Industry' held by the Korea International Trade Association on the 5th at Trade Tower in Samseong-dong, Seoul, Jeong Manki, Vice Chairman of KITA, is seen speaking. (Photo by KITA)

[Asia Economy Reporter Moon Chaeseok] Jeong Manki, Vice Chairman of the Korea International Trade Association (KITA), said on the 5th, "Institutional reform should be carried out in a way that increases market vitality while ensuring benefits for both truck owners and cargo owners."

Vice Chairman Jeong made these remarks at the 'Cargo Owners' Meeting for the Win-Win Development of the Logistics Industry.' At the meeting, KITA and major cargo owners discussed response measures regarding the structural improvement of the domestic freight transportation market following the sunset of the Safe Freight Rate System.

According to Vice Chairman Jeong, the freight transportation market has operated inefficiently, with truck owners' profits shrinking and cargo owners' costs increasing due to the consignment system and multi-tiered transaction structures.

The Safe Freight Rate System, which set minimum freight rates for truck owners based on distance, expired at the end of last year. Cargo owners agreed to refrain from lowering freight rates for the time being, considering the rising operating costs of freight trucks.

The 17 major cargo companies attending the meeting stated, "Even after the expiration of the Safe Freight Rate System, we are paying freight rates at the same level as before."

They also argued, "The Safe Freight Rate System was irrational in that it imposed various additional surcharges with little cost basis and charged fixed rates regardless of volume or contract period. When reforming the system, freight rates should, in principle, be left to the market, but methods other than freight rates should be introduced to ensure a win-win relationship between truck owners and cargo owners."

Vice Chairman Jeong said, "KITA will participate as a representative of cargo owners in the government-led 'Logistics Industry Development Council.' We will strive to implement the introduction of a digital transportation brokerage platform connecting cargo owners and truck owners, abolish the total volume system for freight truck license plates, improve the consignment system and multi-tiered transaction structures, and enforce the submission of digital tachograph (DTG) records to ensure the safety of freight truck drivers."