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Road freight market sees failure and consolidation

Oct 14, 2024 | , , , , , , , , , , , , , , ,

The UK road freight market is facing severe pressures from rising operational expenses and ongoing labour shortages, with Q3 rates surging 10% year-on-year, reflecting widespread cost increases.

This tough economic climate has led to the failure of nearly half of all haulage companies launched between 2019 and 2023, with fierce competition and volatile costs proving too much for smaller operators. Over 50,000 firms have exited the market, particularly in the container freight sector, with many drivers moving to alternative industries.

The failures of these smaller firms have opened the door to consolidation within the market. One of the most significant moves is MSC’s acquisition of Maritime Transport, the UK’s largest haulier. Maritime Transport operates a fleet of 1,600 trucks and has a significant presence at major UK ports.

MSC’s acquisition is part of a wider strategy to consolidate control of overland logistics throughout Europe and is likely to raise concerns among other shipping lines, potentially reshaping customer relationships in the industry.

Simultaneously, hauliers are dealing with significant challenges at UK ports. While DP World’s £1bn development of new berths at London Gateway is progressing, there are continuing political tensions between the operator and UK government officials.

Construction of two new berths will go ahead as part of a long-term plan to make London Gateway the UK’s largest container port, potentially handling six ultra-large container vessels simultaneously by the end of the decade. This expansion will significantly increase capacity and create around 400 new jobs.

Elsewhere, other UK ports are facing infrastructure delays, which are putting essential development projects at risk. The British Ports Association (BPA) has raised concerns over the backlog of harbour orders that ports require to make infrastructure upgrades and expand capacity. These delays threaten billions of pounds in investment and the ability of ports to meet growing trade demands. The situation is particularly dire for ports like Southampton and Plymouth, which have been waiting years for regulatory approvals to begin critical development work.

As the road freight industry faces these mounting pressures, larger operators are increasingly consolidating power while smaller firms struggle to survive.

The efficiency of the haulage sector remains dependent on the performance and expansion of the UK’s key ports, where delays and congestion could have far-reaching implications for supply chain resilience.

Metro offers secure road transport solutions with dedicated vehicles running on fixed routes, ensuring timely deliveries and GPS tracking for full visibility across the UK and continental Europe.

Our road freight teams are strategically located near major manufacturing and transport hubs throughout the UK, enabling efficient logistics support.

To learn more about our domestic and European services, please EMAIL Richard Gibbs to start a discussion tailored to your specific needs.

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Enhanced groupage services to France and Germany

Oct 2, 2024 | , , , , , , , ,

In our continued efforts to provide exceptional trans-European logistics solutions, we have recently upgraded our groupage services to France and Germany, offering greater speed and efficiency, alongside competitive rates and our top-tier customer care.

Our French groupage services continue to excel, offering regular, efficient departures and seamless distribution throughout the country. In addition, we have expanded our reach in Germany, a vital hub for European trade. With frequent departures, including into the Ruhr area, one of Germany’s most important industrial regions, we ensure that goods are swiftly distributed across the country thanks to our trusted network of partners.

In today’s fast-paced and ultra-competitive markets, it’s not just about speed and cost—it’s about communication, reliability, and trust. By carefully selecting carrier and network partners in France and Germany, who share our customer-first mindset, we ensure that our clients benefit from smooth communication, timely updates, and a full door-to-door (DDP) solution. Our goal is to make European shipping as hassle-free as possible, providing a service that values our customers’ time and business.

However, businesses shipping to and from Germany should be aware of some potential changes that may impact the logistics landscape. Recently, Germany has enforced stricter border controls aimed at curbing migrant activity. While the long-term effects on freight traffic remain unclear, it is a development that could impact trucks entering and leaving the country.

Additionally, as of November 2024, UK passport holders will be required to register their biometric details, such as fingerprints or a photo, when entering the Schengen area, which could cause some delays for trucks crossing from the UK into the EU.

Despite these challenges, our French and German groupage services remain reliable and dependable, ensuring that goods are delivered efficiently while providing the highest level of customer care.

Metro’s road transport solutions incorporate dedicated vehicles moving on set routes for security, with defined delivery deadlines and GPS tracked trucks, to provide full transparency on transit schedules throughout the UK and continental Europe.

Our road freight teams are located close by major manufacturing and transport hubs across the UK. To explore the potential of our German and other European services EMAIL Richard Gibbs to begin a conversation.

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European market review and group developments

Aug 7, 2024 | , , , , , , , , , , , , , , , ,

The European freight market continues to face a complex landscape, characterised by fluctuating demand and evolving capacity challenges. In this review, we examine the current state of the road freight market and highlight recent group developments, including the acquisition of a Portuguese intermodal specialist and the launch of a new container shipping service.

Road Freight Market
Despite some positive economic developments, the road freight sector remains challenged by uncertain demand, with no indication of a trend reversal over the summer. This persistent issue is also evident in the capacity trends reported by TIMOCOM’s index. Significant capacity bottlenecks were noted in the first quarter, primarily due to reduced truck fleets.

This trend persisted into the second quarter, with the ratio of freight to cargo space standing at 77:23, dropping further to 73:27 in July, which is typical for the summer months. Despite these challenges, freight rates remain high. Although diesel prices have moderated, other costs, such as driver wages, continue to rise.

The TEG Index tracked a 6% year-on-year increase in haulage prices in July 2023, reflecting the rising costs that hauliers face. This index typically shows prices stalling over the summer before recovering in September, indicating that current trends are in line with historical patterns.

Acquisition of Portuguese Intermodal Specialist
We are pleased to announce the acquisition of Portuguese intermodal specialist KLOG. This acquisition allows us to enhance our intermodal transport capabilities, particularly for customers with significant continental volumes or those aiming to meet decarbonisation targets.

KLOG is renowned for its efficient, reliable, and cost-effective intermodal services to and from the Iberian Peninsula, serving some of Europe’s largest retailers, brands, and manufacturers. Their established rail services to and from Germany and Poland, via hubs in Spain and France, present significant opportunities for shippers trading between Northern Europe and Iberia.

KLOG currently operates two block train departures a week to and from their Portuguese rail hub to Poznan in Poland and Duisburg in Germany, routing via France and Spain. 

These services are complemented by short sea/rail connections. Additionally, four block trains run weekly between Entroncamento (Portugal) and Tarragona (Spain), with a further three block trains operating weekly in Spain between Tarragona, Bilbao, Valladolid, and Sevilla.

A wide range of 45’ equipment is available for all services, including curtain-side, dry container, and refrigerated containers, as well as 20’ ISO tanks. Last-mile delivery and/or collection from the Tarragona hub is available with e-trucks as an option.

Key Benefits:
– 24/7 Control Tower Service
– High rail frequency with daily departures
– Reliable lead-time comparable to road transport
– Sustainable solutions available year-round
– Reduction in truck usage and reliance on scarce driver resources
– CO2 emission reductions of 90% compared to road alternatives

New container shipping service connecting Spain, Portugal, and Northern Europe
Ellerman City Liners, a group container shipping line with over 120 years of history, has introduced a new joint service with CMA CGM, connecting Spain, Portugal, and Northern Europe. This service aims to address ocean freight capacity shortages on key trade lanes, providing speed, service, and certainty to supply chains.

The first vessel of the new iNEX service departed Rotterdam on 9th July 2024. This service enhances efficiency, expands geographical scope, and reduces the carbon footprint for shippers. Operated with two 1,400 TEU vessels, the weekly sailing schedule includes the ports of Cadiz, Setubal, Leixoes, Ferrol, Tilbury, Dunkirk, and Rotterdam.

By working closely with partners Ellerman and KLOG, we are expanding the intermodal options available to our customers, delivering cost-effective and sustainable services as part of our commitment to decarbonising the supply chain.

Metro’s integrated transport services streamline import and export product flows across Europe, North Africa, and Turkey. By combining road, intermodal, and short sea modes, we ensure more efficient cargo transportation, reduced delivery times, and cost savings.

Our extensive partner network, multi-modal transport solutions, and MVT supply chain platforms are designed to meet even the most complex requirements across multiple regions, vendors, and customers.

Discover how we can enhance your trans-continental trading. EMAIL our Chief Commercial Officer, Andrew Smith, to arrange a consultation and scoping discussion.

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Rising lorry thefts prompt calls for government action

Aug 7, 2024 | , , , , , , ,

The Road Haulage Association (RHA) has urged the government to establish a specific offence for freight crime and to develop more secure truck stops. This call comes in response to organised crime gangs (OCGs) increasingly targeting cargo, with over £1 million worth of goods stolen in a single incident this year.

Funded by the logistics industry, the National Vehicle Crime Intelligence Service (NaVCIS) collaborates with police forces across England and Wales to tackle regional lorry theft issues. An officer from NaVCIS described the situation to the BBC as “serious and organised crime,” explaining that these gangs have a deep understanding of supply chains, surveillance, and policing. They use underground networks to handle large quantities of stolen cargo for substantial sums of money.

OCGs often target motorway service stations and truck stops on major routes and their methods include slashing curtains or using bolt cutters on trailer doors until they find valuable loads. Popular items targeted include alcohol, tobacco, electronics, and clothing, which are then sold online, in wholesalers, backstreet cash-and-carries, car boot sales, and markets.

While precise figures for lorry thefts in the UK are unavailable, NaVCIS reported over 5,000 incidents in 2023, equating to about 14 thefts per day and nearly £70 million in losses. Industry experts believe the real figure could be up to seven times higher. Even unsuccessful theft attempts are costly, with each curtain tear repair costing around £100, ultimately driving up consumer prices as these costs ripple through the supply chain.

The need for secure truck stops
NaVCIS, RHA, hauliers, and drivers all emphasise the need for more secure truck stops and upgrading existing sites’ security measures. Only ten sites have received the Park Mark Freight accreditation, launched by the British Parking Association (BPA) in 2022, which requires extensive security measures such as secure perimeters, CCTV, and on-site security staff.

Despite assessing nearly 50 sites, the BPA has only accredited ten truck stops, claiming these sites experience “zero to little crime”, while the low number of accredited sites is reflective of the generally poor standards of truck stops.

In March, the government announced a joint investment of £16.5 million to provide lorry drivers with more parking spaces, better welfare facilities, and safer rest areas. This investment aims to enhance security and reduce the risk of cargo theft.

Our approach to reducing cargo theft
To mitigate the risk of cargo theft during transit, we operate our own fleet of vehicles, deploy two or three-man crews, and use box trailers. Our drivers are trained to:

– Leave vehicles unattended as little as possible
– Choose well-lit, guarded parking areas
– Inspect vehicles and loads after each stop
– Report any deviations from the route or delivery address
– Avoid discussing the route, destination, or load
– Not pick up hitchhikers

We prioritise the safety of your cargo with secure parking areas and advanced trackers for high-value shipments. However, all types of cargo can be targeted by criminals, and standard carrier liability often falls short of covering actual losses.

Protect your investment with our comprehensive All Risk insurance. Metro partners with leading providers to offer All Risk marine insurance, ensuring your cargo is safeguarded throughout transportation and storage, available per-shipment or annually.

For more information on our marine insurance and how to protect your cargo, EMAIL Laurence Burford, CFO at our Birmingham HQ.

Category: Road

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