Rising costs in road transport, what does it mean for inland shipping?

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Rising costs in road transport, what does it mean for inland shipping?

10 November 2021

Several news sources report that road transport costs are expected to rise significantly from 3.5% to 5.7% by 2022. Om de kostenstijging wat meer te spreiden, is binnenvaart een geschikte vorm van transport binnen de huidige toeleveringsketen.

Such an increase in transport costs bring a hefty impact for road hauliers. Indeed, in addition to the regular contract rates, the cost increases will also be excessive. The report ‘Cost Developments in Road Transport 2021-2022’, by research firm Panteia underlines the increase: “the estimators cite labour market problems, the effects of the corona crisis, the shortage of spare parts and the imbalance in international container flows, among other things,” according to Nieuwsblad Transport.

The result? A negative impact on complete intermodal transport, as the cost of pre- or on-carriage increases.

 

Rise in Road Transport Costs

According to Nieuwsblad Transport the cost of transporting goods by road is expected to rise in the coming year: “road transport is now 4% more expensive than in the second quarter of last year.” The rise in fuel costs also adds to this.

European road freight rates are already rising to a record and are expected to continue. Thomas Larrieu, ceo of freight platform Upply, even indicates that “from the carriers’ point of view, this increase is necessary to cover rising operating and recruitment costs. However, maintaining this price level is not guaranteed and maintaining margins will be a real challenge in the coming months.”

Correspondingly, demand for drivers is also rising, which also contributes to the overall increase in road transport costs.

 

How Can Inland Navigation Support This?

A further increase in transport costs across intermodal transport cannot be ruled out, as high inflation is therefore expected to continue next year. A total solution does not seem to be available, but inland shipping is suitable for sustaining and spreading out the cost increases a bit more. After all, the cost of container transport by barge is cheaper than road transport.

In addition, container transport via inland shipping also offers a more sustainable form within an intermodal supply chain, as it keeps the carbon footprint lower. A good approach for any carbon tax also expected in the short term.

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