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Freight transporters face uncertainty

ALMOST the entire European freight market, including the Slovak market, is suffering from insufficient capacity and that is pushing up transport prices, according to a press release issued by the Slovak branch of DHL Freight in early October.

ALMOST the entire European freight market, including the Slovak market, is suffering from insufficient capacity and that is pushing up transport prices, according to a press release issued by the Slovak branch of DHL Freight in early October.

The company wrote that even though increased demand is common towards the end of a year, the current situation differs from previous years and is to a large extent an outcome of the persisting economic crisis as well as a poor outlook for the European and global economy. It specified that the economic climate in the eurozone worsened during the third quarter of 2011 for the first time since 2009 and that the complicated debt situation in the eurozone and the slowdown in economic activity does not indicate anything positive for the foreseeable future.

“This year the impacts of the crisis on transporters are fully manifested,” Rastislav Brenčič, managing director of DHL Freight in Slovakia and Romania, stated in the press release. “These [impacts] were extremely harsh and their consequence was an over 30-percent drop in [transport] capacities. Many transporters were forced to wind down their businesses during the first post-crisis year and even though the second half of 2011 brought some revival, new capacities are arriving very slowly and cautiously because of scepticism and distrust in future developments.”

Brenčič also sees some additional problems: insufficient imports, a large fluctuation in transported volumes, bad payment discipline, problematic access to financing, and rising prices for diesel fuel and highway tolls. He added that the current situation is complicated because transporters need to raise their prices due to increased costs and a mismatch between supply and demand.

“It is difficult to say which of these factors has a bigger impact on price growth but it is certain that until uncertainty stops ruling the market we cannot expect a significant increase in vacant capacities and thus a drop in prices,” Brenčič stated.


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