With road freight prices declining in the United Kingdom prior to peak season, industry leaders are shifting their focus to government initiatives to cement long-term cost stability.
September saw the greatest monthly rise in road freight prices of 2023. However, October data shows a turn of events just before the industry enters the peak season, when freight prices historically reach their annual high. The overall price-per-mile for haulage and courier vehicles dropped by 2.8 points (-2.3%) from 123.3 to 120.5, denoting the largest fall in overall prices since February 2023. With business ramping up as we head towards Christmas, this should provide some relief in the most costly period of the year.
Haulage prices saw the most significant drop, dropping from 118.4 to 114.9 (-3.0%), while courier prices fell from 123.4 to 125.5. Prices are also down almost 4% compared to this time last year. This is partially due to a significant drop in diesel prices year-on-year: diesel prices have fallen by 22p per litre since October 2022.
This will be welcome news for operators, with previous concerns over rising fuel prices in the third quarter of this year. Fuel prices have since stabilised, a positive heading into the sector’s peak season.
Nonetheless, while October provided respite from more volatile periods prior, industry leaders are unsatisfied with a lack of assurance from the government over initiatives to help meet net-zero targets, leaving them without answers on how to best plan for the future. With the government procrastinating its net-zero efforts, the haulage sector is at the mercy of a volatile economy and fuel price hikes. With realistic predictions offering a pessimistic net-zero date, small victories will be crucial in ensuring progress is made.
With heavy costs expected for operators looking to adopt greener practices, this Autumn budget may be significant for satisfying industry concerns over what the future holds for the haulage sector.
Previous UK investment casts pessimistic forecast on budget
While recent announcements of investment in green transport projects should bode well for the transport industry’s budget outcome, previous years have seen transport severely neglected where investment was needed.
With fuel duty rising and a less pressing focus on improving e-vehicle infrastructure, drivers are caught in a transitional period where there is little incentive to switch to green energy sources and yet are stuck paying ever-increasing prices on petrol and diesel.
The RHA has outlined how this Autumn statement can best support the transport industry. The trading association has suggested a fiscal incentive of an emissions-linked rebate to promote a switch to greener fuels. Alongside this, they state the need for a clear and comprehensive roadmap for commercial vehicle decarbonisation, which would support investments in infrastructure and technology.
Further information on the index can be found here: https://transportexchangegroup.com/road-transport-price-index/
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Nathan Moorley
Email: [email protected]