Diesel can't be cut. Its share of turnover can.
21 September 2026, 09:07
Confartigianato Trasporti has done a simple sum: from February to today, soaring fuel prices have cost an average of €11,200 more for every lorry. Its president, Claudio Riva, calls it “a non-reducible cost”. It is the word everyone uses, and the problem reaches well beyond road haulage.
Take a company with ten vehicles, an example built on paper. That is €112,000 gone from the current account in seven months, for the same amount of work. Not an investment, not an expansion. Extra money to carry the same pallets to the same places.
Reducible does not mean cuttable
Reducible is not a category of cost: it is a judgement that comes from the history of the figures, line by line. A fixed cost is reducible when it has risen in absolute terms compared with a level the company has already operated at, because the past proves it can get back there. A variable cost is reducible when its share of turnover has worsened: that it grows along with revenue is normal; what counts is how many cents it takes out of every euro sold.
Diesel is a variable cost, in fact the purest case: it is built into the service, and if you cut it you don't deliver. That does not make it untouchable, though. If it used to account for 28% of turnover and today accounts for 33%, those five points are reducibility that has been lost, and they are recovered where they arise: in the selling price, in the quotation built on real costs, in the clause that links the rate to an index, in the mix of journeys the company accepts.
The mistake I see most often is looking for the saving where it is most convenient rather than where the loss arose. The business owner tightens up on overheads, saves €10,000 a year, and meanwhile has lost €110,000 on fuel. He has worked on 3% of the cost structure and ignored 40%.
On a cost built into the service there are three levers, and only three. The first is the selling price. The second is the contractual clause that passes the increase on to the customer. The third is volume, that is selling enough to stay above break even regardless, the minimum turnover that covers all costs. The fourth lever, waiting for it to blow over, is not a lever. It is a bet.
The tax credit improves profit long before it improves cash
The same statement contains the part that matters most to whoever keeps the books. The tax credit has been refinanced up to a total allocation of €434 million. Riva says: “we still haven't received a single euro”.
This is the point that separates a set of accounts from a bank statement. The credit, once it is certain, is recognised in the profit and loss account and reduces the cost for the year. Profit improves. Cash doesn't, not until the money arrives. It is the classic situation of the company that closes the year in profit and hasn't got the money to pay the month's wages: it is not a profitability problem, it is a timing problem.
Anyone who has advanced €112,000 of diesel in the earlier example and is waiting for a refund of unknown amount on an unknown date is acting as the State's bank. And doing so with their own credit lines, which cost money.
Two numbers are needed here, not one. The first is DSO, the average number of days between invoice and payment: the tax credit does not enter into DSO, but it shares its logic. The second is DSCR, the ratio between the cash the company generates and the instalments it has to pay over the next twelve months: banks normally ask for a DSCR of at least 1.2, and below 1 the situation is critical, because it means the cash flows don't cover the debt. If you are propping up your DSCR by counting on a refund that has not yet been paid, you are not measuring: you are hoping.
An adjustment clause is worth more than a negotiation
The difference between two companies that buy the same diesel at the same price is made by the contract downstream. One has written into its supply contract that the rate is adjusted every quarter in line with a public fuel price index. The other has a fixed price for twelve months and has to renegotiate from scratch every time, from a position of weakness, with the customer replying “that was the quote”.
The first has transferred the risk. The second has kept it for free.
It applies to diesel, it applies to energy, it applies to steel, it applies to labour costs after a new collective agreement. The price ought to stem from the cost structure, and if that structure moves, the price must be able to follow it.
What to look at tomorrow morning
Just one thing. Take the list of customers that make up 80% of your turnover and count how many of them have, in black and white, a price review clause linked to an index or to a threshold of cost variation.
The result is a percentage: how much of your turnover is protected. If it is below 20%, you will pay for the next price rise yourself, and you will find out when the actuals come in.
This article was prompted by a news item published in ANSA.