Transport costs to rise by 8-9 % this year!

On 23 May, an independent industry expert -Digilog Consulting Ltd.- released the Road Transport Price Index for the first quarter of 2023, which shows the cost increase. This year, transport costs will rise by 8-9%!

International transport costs increased by 5.8% and domestic by 7.2% compared to the average cost level in 2022. This means that increases of 5.8% and 7.2% would have compensated for the increase in costs, but that international rates increased by only 0.3% and domestic rates decreased by 4.1%.

https://buszplusz.hu/wp-content/uploads/2023/05/arindex.pdf

According to the index, the energy crisis and general inflation have led to an extreme increase in transport costs of almost 30% in 2022. However, the global post-covid upturn provided the sector with ample orders, while the transport market was characterised by a slight shortage of capacity due to a lack of resources. The fortunate combination of these effects has allowed the transport sector to pass on almost all of the cost increases to its customers and to end the year on a successful note,” says the Transport Price Index.

The growth in costs has slowed down compared to the previous year and the structure has changed. Whereas last year the main driver of the extreme increase was the price of fuel, this year in the first three months of the year it has shown a significant decline, contrary to expectations. However, other cost items have accelerated due to high inflation, with drivers’ wages, tolls, the cost of buying and financing vehicles and almost everything else more expensive than last year.

The fall in fuel prices did not compensate for the increase in other cost items, the deterioration in performance indicators and the negative impact of the strengthening forint. The inability of operators to adapt to falling transport demand in the short term, as the number of their vehicles did not fall in the first quarter but actually increased by 1-2%, also made matters worse for operators. This increased oversupply, which in turn led to deteriorating bargaining positions.

For 2023 as a whole, Digilog forecasts a cost increase of at least 8-9% in the sector, which road service providers are likely to find it difficult to pass on to their customers until the overcapacity is eliminated.

The price index is available at www.kfx.hu.