Transport - Variable Fuel Rate
Please note: If you are a CourierPost or Pace customer, please click here for information on the Variable Fuel Rate pertinent to you.
Why is the Variable Fuel Rate (VFR) different for Express Couriers Limited Transport?
The percentage of costs relating to fuel is much greater for large transport vehicles (trucks) than for vans, which is the primary reason the VFR for Transport services will almost always be a different value than the VFR quoted for CourierPost and Pace services.
The base point for the Transport VFR calculation is from 1 August 2007 (92.25 cents per litre) due to the other rate adjustments that were made prior to this date.
Auckland Council implemented a 10 cents per litre (excluding GST) Regional Fuel Tax in July 2018. To account for this, on 1 September 2018, 2.6 cents per litre was added to the Diesel Taxes, Duties and Levies factor within the VFR calculation.
Road User Charges
The Government announced changes to the Road User Charges (RUC), in effect from 1 October 2018. See the Ministry of Transport website for more information. These changes vary depending on vehicle configuration, however represent a significant change across our road operations.
From 1 December 2018, New Zealand Post implemented a Road User Charge (RUC) surcharge to cover the increase in RUC costs within our transport and courier fleets to maintain the same levels of service that we offer today. Details are listed in the table below.
The RUC surcharge will be included, together with the Variable Fuel Rate (VFR), in the Variable Price component of our invoices and statements. The RUC surcharge will only be updated in line with changes to Road User Charges.
Variable Fuel Rate (VFR)
|Road User Charge
||Total Variable Rate
Past Variable Fuel Rates:
The total price you pay for a product or service is made up of two components:
- a Base Price; and
- a Variable Price
In order to calculate the total price you pay, we add these two components together, round the total to the nearest cent and then add GST.
Our Base Price component is the price for our products and services set out in our contract with you.
Our Variable Price component is calculated as a percentage of the applicable Base Price. The percentage which we apply to the applicable Base Price is comprised of the Variable Fuel Rate (VFR) and Road User Charge surcharge (RUC).
The VFR changes from month to month because it is linked to the changing cost of diesel. We use the VFR that applies on the date you order your product or service. The RUC surcharge will only change in line with changes to Road User Charges.
You can calculate the total price you pay according to the following formula:
Base Price + (Base Price x (VFR % + RUC %)) = Total Price (excl. GST) For example, if the base price of your product or service was $500.00 and the VFR applying for the month was 3.7% and RUC 0.3%, then the total price you pay would be $520.00 calculated as follows:
Total price (excl GST) = 500.00 + (500.00 x (3.7%+0.3%)) = $520.00
Calculating the VFR
The VFR is linked to the ‘Diesel main port price excl. taxes’ as published in the Weekly Oil Price Monitoring tables, by the Ministry of Business, Innovation & Employment (‘Index’). The Index is published on the Ministry’s website on the Oil Price Monitoring page
The prices shown in the Index exclude diesel taxes, duties and levies. For the purposes of calculating the VFR we add these diesel taxes, duties and levies to the average weekly diesel prices in the Index. To find out the current amount of these diesel taxes see the Energy Prices data table
Two Month Lag
We calculate the VFR for any given month using the average diesel prices from two months earlier. For example, to calculate the November 2007 VFR we will use the average diesel price from September 2007.
Baseline Diesel Price
We have used a baseline average diesel price of 92.25 cents per litre. No VFR will apply in the relevant month (see above) if the average diesel price including taxes, duties and levies is less than 92.25 cents per litre in that month.
The VFR alters from month to month according to the average monthly diesel price as shown in the table below.
|Average Monthly NZ Diesel Retail Price per litre (incl diesel taxes, excl GST) greater than:
||Average Monthly NZ Diesel Retail Price per litre (incl diesel taxes, excl GST) less than or equal to:
The VFR will be calculated in the same manner as set out in the table above where the average diesel price (incl. diesel taxes, excl. GST) is more than $1.1425 a litre.