European road freight growth slows

London, UK: The European road freight market slowed in 2018, with volume growth at 2.9% for the year, according to analysts Ti.

This followed 3.3% growth in 2017, the fastest expansion Ti has recorded in more than seven years.

These findings come from Ti’s latest report, European Road Freight Transport 2019, which forecasts the slowdown continuing throughout 2019 as performance in key European retail and manufacturing markets remains subdued.

Major European economies have struggled. Germany flirted with recession in the latter stages of 2018 as a result of softer external demand and disruption in its automotive sector, while Italy felt the effects of mounting public debt and Brexit uncertainty continued to harm investment in the UK economy.

Andy Ralls, quantitative analyst, Ti said: “As road freight remains by far the dominant mode of transport for moving goods domestically and internationally in Europe, its market growth in volume terms has been adversely affected through falling economic growth in 2018.”

Ti’s forecast for the five years to 2023 is more positive, although growth is not expected to be significantly higher than the rate seen in 2018. While the market faces a number of challenges as a result of headwinds in the European economy, the underlying fundamentals are good and will be supportive of expansion over the medium-term, even if that growth is not particularly dynamic.

Looking ahead over the five years, Ti’s head of research, Nick Bailey, said: “Ti expects to see a steady rise in demand for goods as household spending power increases and production capacity and productivity rise. Volume growth in the short-to-medium term will be dependent on these macroeconomic fundamentals which, importantly, suggest solid in growth rates of both domestic and international road freight transport.

The main beneficiaries are likely to be markets in Central & Eastern Europe where downside risks from any slowdown in major trading partners will likely be limited by rising domestic demand and wage growth in tight labour markets.”

For details about the report and to buy see: http://www.ti-insight.com/product/european-road-freight-transport.

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