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Advisory

Update on FCL trucking

Looking back at 2018, we saw an increasing pressure on FCL trucking capacity as well as increasing rates. This is a result of a lack of truck drivers combined with increased focus on enforcement of cabotage rules across the EU.

International truck driver shortage
According to the latest research from Transport Intelligence, the industry as a whole is faced with a historic challenge. A report released this week by European Road Freight Transport 2018 points out that six countries (UK, Germany, France, Denmark, Sweden and Norway) in total experience a lack of 127,500 drivers.

Some countries are hit harder than others
The UK leads the way with a shortage of 52,000 drivers, closely followed by Germany with 45,000 vacancies with predictions that this could increase by 28,000 each year. France experiences a shortage of 20,000 drivers, while road freight associations in Sweden, Denmark and Norway report shortages of 5,000, 2,500 and 3,000 respectively. This of course leaves out more than 20 countries in Europe where the numbers have not been counted. However, it is safe to assume that similar trends are likely across western countries, where the number of drivers has declined over the past two decades.

Why this development?
This gap in the labor market has been partly filled up by an influx of East European truck drivers. However, according to the report there is a limit as to how much this will ease the driver shortage short term and in the future. One problem is the increasing tendency among global manufacturers to place production facilities in Central and Eastern Europe. This creates an alternative source of jobs for many future truck drivers, who prefer working in factories.

Further reforms in the road transportation sector with specific focus on limiting systemic misusage of cabotage rules and improving conditions for truck drivers are expected in 2019, where the EU aims to pass and implement new legislation.
The implementation of these measures are expected to result in further pressure on the truck driver capacity and thus also trigger further cost increases across the industry.

Mads Drejer
Nordic Ocean Freight Director