Never before has the price level in European road transport been as high as it is now. After five quarters of rate increases, the benchmark of Upply, IRU and Transport Intelligence (TI) is at a record level.

In the third quarter, rates in Europe rose by an average of 0.9%. Road transport is now 4% more expensive than in the second quarter of last year. In a note, the analysts attribute the rising rates to the economic recovery, combined with disruptions caused by congestion and capacity problems due to the driver shortage.

Rising costs for transporters are also pushing up prices, the researchers say. For instance, the diesel price in Germany is now almost 40% higher than a year ago. Also in the UK (+27%), Spain (+25%) and France (25%), entrepreneurs are paying more for fuel.

The fastest increases in transport rates were seen on routes between Germany and France in the past quarter. The French economy is doing well and the demand for products from Germany is high. Journeys from Duisburg to Paris are therefore now more than 20% more expensive than a year ago. The Italian economy is also doing well, causing the price of transport from Duisburg to Milan to rise by more than a tenth in a year.

The tightening of the border regime as per 1 January 2022 also gives UK transport an uncertain period ahead. Further disruption of British imports is therefore in the offing.

According to Thomas Larrieu, CEO of freight platform Upply, it remains to be seen whether the 5% price increase in the last quarter of this year and the beginning of 2022 will continue. From the carriers' point of view, this increase is necessary to cover increasing operating and recruitment costs. However, maintaining this price level is not guaranteed and maintaining margins will be a real challenge in the coming months.

The preparers of the fare index base themselves on an analysis of 350 million FTL and LTL trips from Upply's database.

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Source: Nieuwsblad Transport

November 16, 2021