Volatility in fuel markets is creating real pressure for engineering and consulting businesses across Aotearoa. Rising and fluctuating costs are affecting staff, project delivery, supply chains and client relationships – often all at once.
For business leaders, the challenge is not only financial. It’s about maintaining confidence, fairness and momentum while operating in an unpredictable environment.
ACE members are well‑placed to lead through this uncertainty by focusing on three key areas: people, commercial arrangements and project delivery.
Leading and supporting your people
Fuel price instability affects household budgets, travel patterns and stress levels, particularly for employees who rely on vehicles to do their jobs. Clear and empathetic leadership matters.
Be clear and transparent with your people. Acknowledge what’s happening, what the business can control, and where flexibility is possible. Even when answers are incomplete, certainty about intent builds trust.
Practical support might include:
- Enabling remote or hybrid work to reduce unnecessary travel
- Offering flexible start and finish times to reduce peak-hour travel
- Condensing work weeks, for example four longer days instead of five
- Reviewing mileage rates and travel policies
- Provide parking discounts, rideshare incentives, or public transport subsidies
- Promoting EAP services, financial wellbeing tools or budgeting support
Managing commercial risk and client expectations
Fuel volatility poses real commercial risks, particularly on long‑running projects where pricing assumptions may no longer hold.
Now’s the time to revisit contract terms, especially provisions around cost escalation, price adjustment mechanisms, variations, delay and risk allocation. Ensure project managers and commercial teams understand where fuel‑related impacts sit contractually and when discussions with clients should be triggered.
Early and open engagement with clients is critical. Rather than absorbing unplanned costs or waiting for disputes to arise, initiate conversations when impacts become apparent.
Leaders should also support teams to document impacts carefully through project records, cost tracking and correspondence. This strengthens the firm’s position and helps maintain transparent, professional relationships even when conversations are difficult.
The Society of Construction Contract Practitioners (SCCP) has released practical guidance to support those delivering services under NZS 391X contracts. SCCP’s guidance provides a framework to help Principals, Contractors and Contract Administrators distinguish cost escalation from delay or disruption; understand notice and early warning obligations; assess potential cost and time relief pathways; and recognise when a mutually agreed amendment to the commercial agreement may be appropriate, and how to document it properly.
NZTA Waka Kotahi has also released guidance on its approach to issues arising from the impact of the Middle East Conflict on projects procured under NZS391X contracts and project alliance agreements. It sets out the categories of contracts and the respective contractual mechanisms or changes to address the impacts for NZTA and its partners.
> Read the NZTA Waka Kotahi guidance
Keeping projects moving in uncertain conditions
Fuel disruption can affect more than just price – it can influence access to materials, subcontractor availability, and delivery schedules. Maintaining momentum requires agility and scenario planning.
Encourage project teams to stress‑test schedules and assumptions. Where possible, build contingencies, resequence work, or explore alternative delivery approaches that reduce exposure to fuel‑intensive activities. Flexibility now can prevent larger delays later.
Clear internal communication is essential. Ensure leadership, project managers and commercial teams are aligned on decision‑making thresholds, escalation pathways and client messaging. Consistent direction reduces uncertainty on the ground and empowers teams to act with confidence.
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