20% Drop in Haulage Rates according to ONS figures

Published: 22 November 2013

20% Drop in Haulage Rates according to ONS figures

According to figures from the Office for National Statistics (ONS), Road haulage rates fell by 0.8% in the third quarter of 2013.

The fall in prices for freight transport by road in the three months to the end of September is the first ever documented in the ONS’s Services Producer Price Index, which has measured changes in the prices received by businesses in the UK for selected services since late 2010. It leaves road haulage rates just 0.17% higher than they were at the end of 2011.

A spokeswoman for the ONS said the haulage figure, based on information from over 300 firms with at least 10 employees, was largely down to a drop in the tipping and construction sector.

RHA director of policy Jack Semple said the figures were not surprising, though the association’s perception was one of flat, rather than falling, rates.

“There remains very intense pressure on costs in much of the haulage industry and hauliers are working very hard at the moment to explain to customers why they need a rate increase,” he said. “We’ve had reduced demand and intense pressure on rates for five years now – the cumulative effect of that has got to be significant.”

Any squeeze in the tipping and construction sector might be down to increased activity in that market by the pallet networks, suggested Semple.

“There has been some controversy over some very aggressive pricing from some of the pallet networks recently and I know they have been doing an increasing amount of construction work, so that may be part of it,” he said.

Semple added that in order for transport providers to continue meeting customer requirements, Haulage rates will have to rise soon.

“Rates have got to start to increase – certainly rates net of diesel prices – because vehicle costs have risen sharply,” he warned. “There is only so long the industry can go on working on wafer-thin margins if it is going to continue to provide a sustainable service and invest.”

ReturnLoads.net will report more on the story when news is available

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