Average haulage prices fell by 9.51% in January 2023 following a short-lived spike in December 2022.
Excess demand for hauliers over Christmas had pushed haulage prices to an annual high in December. Last month, however, haulage prices fell to more muted levels.
Although the drop is significant, it follows an expected pattern. A spending splurge in December increases demand for hauliers. Then in January, when the public reigns in retail spending, demand for haulage falls – and haulage prices follow suit.
Despite the fall, multiple factors suggest haulage prices will climb as 2023 unfolds. UK inflation remains high. And the costs of goods such as AdBlue, rubber, carbon and steel – all essential to the road transport industry – have recently increased.
Elsewhere China’s economy has reopened following covid lockdowns, which is expected to place upwards pressure on fuel costs. If fuel wholesalers maintain their current margins, prices at the pumps will most likely rise. Meanwhile, closer to home, the UK government has announced new measures to curb illegal immigration. The new measures include tougher penalties for truck drivers and owners transporting immigrants into the UK – whether knowingly or otherwise. Maximum penalties for each person found on a truck will cost five times as much as before the change, with extra penalties for failing to adequately secure vehicles. This again saddles the haulage industry with increased costs, if not through penalties then through extra measures to prevent falling foul of the rules. While haulage prices fell in January, then, the trend may prove short-lived.
Lyall Cresswell, CEO of HX parent company Transport Exchange Group, said:
“Having closely tracked haulage and courier prices for the past four years, we’ve come to expect the trend of prices dropping in January, following peak demand in the run-up to Christmas.
“A new factor for price trends, however, is the price of diesel stubbornly refusing to come down in line with petrol prices. For an industry that remains reliant on diesel, this is a significant business cost.
“There’s a real push for alternative fuel vehicles, but that won’t solve the imminent cost issue. In the short term, many road transport businesses might simply have to charge their customers more.”
Kirsten Tisdale, director of logistics consultants Aricia Limited and Fellow of the Chartered Institute of Logistics & Transport, said:
“Although the drop between December 2022 and the January 2023 TEG Index looks dramatic when seen on its own, it’s actually part of a reasonably predictable pattern. The various elements of the index are all pretty much where you’d have expected them to be, based on applying the percentage change from 2019 to 2020, which is what we all used to consider ‘normal’.”
The HX Price Index will continue to track changes in courier prices in Feb 2023 – and beyond.
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