All statements are based on information taken from the logistics platform TRANSPOREON. The platform connects shippers from industry & trading companies with carriers, drivers & consignees – and optimizes and accelerates logistics processes. Currently more than 1.000 industry and trading companies, more than 55,000 carriers and more than 150,000 users from 100 countries are connected via the platform. Data is anonymously exported from the platform and aggregately analyzed by Capgemini Consulting. The full report can be downloaded here.

As indicated in the twenty-sixth edition of the Transport Market Monitor (TMM), transfer prices of full and partial loads are dropping further within Europe. The TMM price index declined to the same level as seen last year, mostly driven by the lowest oil prices within the last twelve years. Simultaneously, available capacity has increased since Q2 2015. Seasonal fluctuations are typical for the transportation industry. The increased capacity index in Q4 2015 was therefore not a surprise. However, the index dropped to 88.6, which is below the 90.9 of the previous year. The price index dropped at the same time to 98.2 which is, as mentioned before, exactly the level of the year before.

One would assume that the price index would be higher considering less available capacity compared to the previous year, but the lower price index is driven by the six-years-low of the diesel price. Considering the share of the diesel cost on the total costs for freight companies (25.74 % according to the BGL) one wonders if benefits of a low diesel price are equally shared between customers and freight companies. The next Transport Market Monitor in May 2016 will indicate if price adjustments will take place.

Due to the ongoing political development regarding the European refugee crisis, the impact of the expansion of border controls on TMM indices is still being studied. At the external borders of the Schengen Area waiting times have increased strongly. Additional costs of up to 10 billion Euro annually are expected by Martin Wansleben (Chief Executive of the Association of German Chambers of Commerce and Industry DIHK), due to traffic jams, increasing bureaucracy or changing supply concepts of carriers.

In general such developments are affecting all players in the market. Personally, I expect these impacts to be noticeable within one of the next TMM editions. On the other hand, major players do not necessarily have a better position compared to smaller transport companies.

A more crucial factor is the relation between the actual shippers and the transport service providers. Flexibility and openness for new concepts must be balanced against possible disadvantages from lower capacities and higher freight rates. I am looking forward to hear your opinion regarding these developing topics. Feel free to contact us at Capgemini Consulting!