The Challenges Faced By The Accident Towing Industry

Towing a vehicle following a crash is a vital part of road safety. It reduces the risk of accidents by moving a vehicle so that it does not cause a road safety hazard or damage other vehicles on the road. It can also be a valuable asset in recovery. However, the industry is not without its challenges. In addition to a range of regulatory and accreditation requirements, the Accident Towing Services Act 2007 also requires that persons who provide accident towing service are technically competent, of appropriate character, act with integrity and are provided with a safe, efficient and timely service.

Productivity adjustment factor

The regulated fee rates for accident towing are determined using an annual productivity adjustment factor (PAF) that reflects cost changes in the broader transport industry. A positive PAF indicates that the accident towing industry will achieve greater productivity gains than a broader transport industry and this can be shared with customers through lower regulated fees.

A deteriorating PAF could be an indication that firms are cutting costs in response to cost pressures or decreased financial viability. Alternatively, deteriorating PAF performance may indicate that operators have an established monopoly position and the incentive to provide high quality service is minimal due to a lack of competition.

‘Spotter’s fees’ and other scams

In the absence of strict regulatory controls, some operators have been known to offer cash rewards for letting them know when an accident is upcoming. These’spotter’s fees’ are illegal in most states, but in Western Australia companies have been found to advertise payouts of up to $200 for accident tips-off.

It is also possible that’spotters’ are attempting to lure not-at-fault drivers into signing documents that will give them permission to sue the at-fault driver for inflated repair fees, as in the case of Victorian lawyer Nicholas Logan. These scams are often perpetrated by unscrupulous tow truck drivers who are able to take advantage of the weak and vulnerable.

Trade towing

In addition to accident towing, some tow truck operators also operate a ‘trade towing’ service. This can include clearway towing and breakdown towing. These types of towing jobs have a similar ‘input’ of staff, fuel and standby capacity to accident towing, but do not necessarily result in a road safety hazard.

‘Crash towing’ is the only regulated towing service in Victoria and it involves towing a vehicle following an accident. Tow trucks must be licensed and accredited by VicRoads to carry out this work. Tow truck drivers, operators and depot managers must also be accredited by VicRoads to ensure they are technically competent, of appropriate character, act safely and with integrity when providing these services.

Crash towing is an essential part of road safety and a valuable asset in the recovery process, so it is important that tow truck operators are competent and provide a safe and reliable service. They must also follow a number of laws including road safety, consumer protection and design standards.

A ‘dormant’ licence

Licence holders have the option of affixing a licence to a ‘dormant’ tow truck to retain its associated entitlement to accident allocations under the Melbourne controlled area. This allows licensees to reduce the number of tow trucks they operate and to manage their fleet more efficiently.