New insolvencies data released by Australian Securities & Investments Commission (ASIC)suggests mounting financial pressure is leading to more Australian transport and logistics operators being pushed to the brink.
The latest data shows insolvencies in the sector is rising, with businesses continuing to struggle amid rising costs, labour shortages, regulatory burdens and falling asset values.
Business recovery and insolvency firm Jirsch Sutherland says the global challenges have led to the collapse of several notable local operators including Scott’s Refrigerated Logistics, Austrans Container Services and Lion Global Forwarding.
The ASIC data shows a sharp upward trend in insolvencies within Australia’s transport, postal and warehousing sector.
While there were 196 insolvencies in 2021-22, the number rose to 347 in 2022-23 before jumping again to 495 in 2023-24 – a 153 per cent increase in just two years.
As of April 6 this year, 535 insolvencies have already been recorded, a 173 per cent increase compared to 2021-22.
“Businesses are being squeezed from every direction — whether it’s rising operating costs, labour shortages or compliance pressures. Margins are incredibly thin, and many operators simply can’t absorb the extra costs,” WA Insolvency Solutions (Jirsch Sutherland’s WA division) managing partner Jimmy Trpcesvski says.
Hymans Valuers and Auctioneers CEO Ian Hyman OAM says the second-hand truck market has flipped since the pandemic, with some values dropping by as much as 70 per cent.
“Long-haul operators are doing it particularly tough. They have massive investments in equipment and huge ongoing costs, and with interest rates still high, their repayments remain burdensome,” he says.
“Government regulation is getting worse: industry collective bargaining, unrestrained union behaviour, abolition of employee restraint clauses and a myriad of other government-related controls create roadblocks to efficient and well managed operations. It’s all going to make life even harder.
“These are unprecedented times. I think we’ll see further increases in insolvencies for another couple of years at least.”
Despite the pressures, Trpcevski says there are options available for viable businesses.
“The Small Business Restructuring and Voluntary Administration regimes are providing much-needed lifelines for operators looking to reset and recover,” he says.
“SBR has been a game-changer for eligible small businesses. For those that don’t qualify, VA can provide a path forward – a chance to take control and avoid liquidation. It’s not about shutting the doors, it’s about steering through the crisis.”
Jirsch Sutherland is currently handling the liquidation of a national transport and logistics business that grew rapidly but struggled with cash flow as trading costs rose.
“The company had expanded quickly to meet demand but didn’t have the working capital to manage the increased overheads. By the time we were appointed, it had already ceased trading,” Jirsch Sutherland principal Andrew Mattinson says.
“That kind of imbalance in the transport sector can be like trying to accelerate uphill in top gear – you’ll stall if the engine doesn’t have the torque to match.”
The team coordinated the wind-down of the business, which had over 100 prime movers and trailers located across multiple states.
“It was like coordinating a recovery mission across a multi-state depot network,” says Mattinson.
“However, thanks to the director’s, asset financiers’ and auctioneers’ cooperation and clear records, we were able to recover the assets efficiently and have ensured creditors are in the best position they can be, given the company’s circumstances.”
Mattinson says that while not all transport companies are at risk, pressure points are building across the sector.
“Some businesses are well prepared and are actively reviewing costs, safety regulations, debt levels, and contract structures – but others are leaving it too late. That’s why early advice is critical – before the brakes fail entirely,” he says.
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