COVID-19 has impacted nearly every industry, and trucking is no exception. The European trucking market was hit particularly hard in the second quarter of this year.
A recent report from the International Road Transport Union (IRU) anticipates that the European trucking market will face “huge and escalating” losses, with revenue falling $72 billion this year. If the IRU’s foreshadowing comes to fruition it would mean a staggering 17% downturn in revenue when compared to 2019. To make matters worse, the report also predicts that many companies may not be able to survive in these difficult and turbulent market conditions.
Why European Markets Have Been Hit So Hard
There are two possible causes for Europe being hit particularly hard. The first could be the dramatic decline in demand. When countries began shutting down in March, demand for many non-essential goods seemed to have vanished almost overnight, resulting in an alarming reduction in trucking demand.
The border restrictions that came with the countries shutting down could have been the second. Many countries, when deciding to lock down to slow the spread of the virus, closed their borders as well. This impacted trucking more than other industries, as closed borders led to slowdowns and disruptions. Many companies were forced to deal with increased controls at border crossings, insufficient green lanes, and mandatory convoys. These issues, coupled with systematic quarantining of drivers, resulted in significant border delays.
Driver shortage could also be a noteworthy issue for the industry, as it is up from a 23% shortage in 2019 to a 36% shortage in 2020. To cope, many employers are trying to offer competitive salaries while at the same time working to keep profit margins high enough to stay profitable.
Perhaps one bright spot for the industry is the decline in diesel prices, which were down 21% in May over the previous year. However, for many companies, this may not be enough to compensate for the impacts of COVID-19. As global uncertainty continues, due in part to the pandemic, European trucking companies will probably continue to feel the impact of shutdowns and safety protocols.
With offices in Rotterdam and Amsterdam, ClearFreight the Netherlands serves as a gateway to most European Nations. These offices enable our team to stay up to date with all aspects of EU logistics and to provide clients with access to the continent. Contact our team to learn more about how we can help you navigate through this turbulent time for EU trucking and logistics.