Haulage prices drop despite ongoing driver shortage

Average haulage prices on the Exchange fell by 1.6% in November and are now 14.2 points lower than they were in November 2021. The drop represents an 11% year-on-year decrease and a second consecutive month of falling prices.

Haulage prices typically drop in November before spiking in December, although the fact average haulage prices are quite so low seems puzzling. A new report by the International Road Transport Union published last month highlighted an ongoing truck driver shortage. According to the report, the number of unfilled truck driver positions could triple by 2026.

What’s more, fuel prices increased in November. Diesel prices increased by 2.19%, while petrol prices were relatively unchanged (falling by just 0.01%).

Stagnant retail sales, which remain below pre-pandemic levels, therefore seem to explain November’s drop in average haulage prices.

Lyall Cresswell, CEO of Haulage Exchange parent brand Transport Exchange Group, said:  

“Although the cost of living crisis will undoubtedly impact Christmas sales figures, the price index will inevitably rise, as all the previous data tells us. 

“Road freight companies will welcome the increased revenue, but the HGV driver shortage will pose staffing issues across this busiest of times. Nonetheless, businesses will be looking to take advantage of the Christmas delivery surge, particularly as 2023 will bring challenges in the form of fuel duty and energy price hikes. 

“In common with every sector, what the road freight industry really needs is a drop in inflation. Until that happens, profit margins will be squeezed and the industry will have to focus on efficiency and show its customary adaptability.” 

Kirsten Tisdale, Director of Logistics Consultants Aricia Limited and Fellow of the Chartered Institute of Logistics & Transport, said: 

“Despite conforming to a pretty regular pre-peak dip, it feels surprising that the haulage element of the TEG index for November is now at the same sort of level as it was in late spring, particularly given that fuel prices are still so high. The comparatively high levels of logistics job adverts must be a function of the tight employment market rather than reflecting a high level of demand.” 

UK inflation eased to 10.7% in November. By historical standards, the figure is relatively high.