While South Africa is being inundated with bad news catalysed mainly by our sorry lot of politicians whose vision goes only as far as what they see in the trough, it is good to know that the trucking industry on the other side of the ocean is experiencing healthy growth.
Clear International, a UK-based consulting group working with companies active in the automotive and transport markets, has issued a new report forecasting the demand for heavy goods trailers in Western Europe up to 2020 which shows that the trailer market has got off to a strong start in 2016 and is forecast up 9.3% in the first half and 9.2% for the year as a whole.
Germany and Italy will have strong increases in trailer registration this year and account for more than half the market growth on their own. Other markets posting strong growth will be Spain, France and Denmark. The UK, having posted record figures in 2014 and 2015, will fall back slightly this year but trailer demand remains at an exceptionally high level. In fact, the UK market was strongly ahead in the first quarter of 2016.
The strong demand for trailers means that a new record will be set for the trailer parc in 2016. The 2008 figure achieved before the Global Financial Crisis therefore stood for seven years without being bettered.
Trailer registrations in 2016 and 2017 will be higher than the 2006 figure – itself currently the third highest on record – but it will not match the level of 2007 and 2008. The very high trailer registrations in 2007/8 were triggered by circumstances not likely to be repeated. At that time, there was strong economic growth plus several East European countries joined the EU in 2004 and in 2007.
This led to a boom in trailer demand – for both new and used vehicles – in Eastern Europe. The used trailers exported to the East were replaced by new units in the West until manufacturers couldn’t keep up with demand. For these reasons, the demand levels of 2007/8 may not be repeated for a considerable number of years, or indeed, at any time.
Within the big seven economies of Western Europe, all are forecast to have higher levels of GDP and business investment in the 2016/17 period. However, we are now approaching the tenth anniversary of the Global Financial Crisis which decimated the trailer market in 2009.
Gary Beecroft, director of CLEAR says: “A cyclical slowdown in 2018 or 2019 is now almost inevitable and the only real questions are how far the market will fall and how long this slowdown will last.”
Beecroft points out that 77% of all goods in Europe are moved by road with most of that proportion being transported in a trailer. Now, if only South Africa’s ‘leaders’ could focus on economic growth instead of on politics, perhaps we could see more of our goods being exported and carried to global markets on some of those trailers.