European road freight rates are expected to climb over the rest of 2024. Driver shortages and the introduction of CO2 levies in a number of European countries will see margins pressurised further.
Upply x Ti x IRU published its European road freight rate index at the start of August. The Q2 spot rate index rose by 3.5 percent quarter on quarter and is up by 0.8 percent year-on-year.
The contract index fell by 1.3 points quarter on quarter. Ti head of commercial development, Michael Clover said: “Though the pace of road freight cost increases has slowed, notably falling in terms of fuel, we still expect to see costs rising for the year ahead.”
According to IRU’s preliminary 2024 driver shortage results, 48 percent of European companies expect to face more difficulties filling truck driver positions next year. Over one-third of truck drivers are 55 years old or older and will retire in the next 10 years, while only 5 percent are under 25. Additionally, road freight demand is expected to improve in 2025.
Sweden, meanwhile, will add tolls for CO2 emissions from vehicles with a gross combination weight exceeding 12 tonnes in January 2025, extended to all vehicles by the end of March 2027. IRU said that the toll increase is expected to be limited initially, although no firm figures are available yet. Denmark and the Netherlands will follow suit in 2025 and 2026, respectively.
In May 2024, 16 EU countries (Belgium, Bulgaria, Croatia, Cyprus, Greece, Ireland, Italy, Latvia, Lithuania, Luxembourg, Malta, Poland, Portugal, Slovenia, Slovakia and Spain) received a formal notice from the European Commission to advance with the implementation of the Eurovignette Directive. IRU said that changes to tolling might come sooner than expected for these countries.
Additionally, three countries have announced changes to their toll fees which are not related to the Eurovignette Directive. Toll fees for heavy-duty vehicles have increased by 6.8 percent in Slovenia since mid-July 2024. Fees have also increased in Belgium since July, following an adjustment for inflation (electric and hydrogen trucks are exempted in Flanders and Brussels but not in Wallonia). Hungary will implement a similar correction in January 2025.
“Road transport companies, key drivers of economic growth, are facing the dual pressing challenge of meeting demand for transport services amid soaring costs – fuel prices are projected to increase, labour costs are on the rise, and now we also have the new CO₂ tolls – while also decarbonising,” said IRU senior director for strategy and development, Vincent Erard.
”This is likely to increase freight rates, as growing demand for transport services is putting pressure on the available capacity. With much of the sector consisting of small and medium-sized enterprises, operators have razor-thin margins. Policymakers must support operators and the sector to meet demand, including by quickly investing in both efficiency measures – for vehicles, drivers and the wider logistics system – and alternative fuels implementation. This would serve our planet and economy.”
