FTA releases 2016 Logistics Report

By Categories: NewsPublished On: Friday 29 April 2016

cvshow_fta_lowresOnline shopping is one of the key contributing factors to a strengthening economy and concurrent increase in demand for logistics services, according to the Freight Transport Association’s (FTA) Logistics Report 2016.

The report, which was launched at the CV Show in April, shows that the average weekly spend on online shopping increased by 12.4 per cent in 2015 compared to the previous year, and doubled compared to the amount spent in 2010.

The annual FTA Logistics Report aims to highlight the key events and trends of the industry over the past year, and to outline how government can support the sector.

Among the previous year’s highlights as documented in the report was the 26 per cent increase in HGV registrations compared to the previous year – which is thought to have been affected by the pre-Euro 6 stockpiling of vehicles – and 16 per cent increase in LCV registrations.

The falling price of diesel was also highlighted, which was cheaper than petrol last August and September for the first time in 14 years – while road transport operator profit margins increased slightly to four per cent in 2015.

There had been safety improvements meanwhile, the report found. HGV annual test pass rates had increased steadily between 2011 and 2014 from 75.3 per cent to 80.1 per cent, and roadside prohibition rates for mechanical checks and more markedly, for drivers’ hours, had both reduced.

Meanwhile, the number of fatal accidents per billion lorry miles had fallen by 3.5 per cent in 2014 compared to the previous year, and 43 per cent compared to a decade earlier.

The report did, however, highlight an increase in accidents of all severities involving HGVs, up five per cent, which is approximately in line with the increase in accidents for all vehicles.

Meanwhile, roadside prohibitions resulting from weight checks were actually up in 2014 on the previous year, albeit slightly decreased since 2011.

On efficiency, the percentage of HGVs empty running (28.8) was only marginally up in 2014 against the previous year, and had remained fairly steady since 2012 – as had the lading factor percentage, at around 62-63 per cent. Average miles per gallon for artics, at 7.9 in 2014, had also been relatively static since 2011.

In terms of haulier costs, according to FTA figures from January, average fuel spend for one truck per annum stands at £38,000 – while fuel represents around 30 per cent of operating costs for a 44-tonne HGV.

During 2015, FTA noted a marked increase in the average cost of tyres, at 6.4 per cent, and a similar-sized increase in external workshop charge-out rates.

The report also underlined the road transport sector’s difficulties in recruiting professional drivers.

In 2009, 22 per cent of respondents had faced problems in this regard, whereas in the fourth quarter of last year this stood at 75 per cent – albeit having reduced slightly from the previous quarter. The current estimated shortfall stood at 45,000 drivers.

The report said that the HGV Trailblazer Driver Standard, approved in December by the government skills minister, was “an important step forward” in this regard – but that government had “failed to address the issue of a lack of more general vocational training funding.”

FTA additionally raised the issue of the threat to the industry from cross-Channel disruption, a recurring theme in recent times.

“Even though only 15 per cent of the HGVs that come across the Strait of Dover are UK registered, the effects of the chaotic situation in Calais during 2015 were felt throughout the country,” the report stated.

“With the imposition of Operation Stack for at least 28 days over the course of the summer and millions of pounds worth of delayed and spoiled goods, the consequences for UK trade became increasingly apparent.

“According to FTA, the delays in Kent cost UK logistics around £750,000 per day. The events of 2015 drew attention to a key weakness in the UK’s supply chain.”

A key source of data for the report was the Logistics Industry Survey 2015/16, responses to which suggested that road investment, recognition of logistics’ vital role in the economy, and cutting fuel duty should all be major priorities.

Commenting, FTA policy director Karen Dee said: “There is no doubt that logistics is changing.  Online shopping is just one example – we have already seen how it has grown, and it is expected to continue to rise in the next few years – with estimated retail spending set to reach £62.7 billion by 2020.

“Resilience is part and parcel of the logistics industry but all of this inevitably has implications for delivery fleets and skills.

“This year’s Logistics Report indicates that economic expectations for our sector are optimistic.  Domestic activity is expected to increase in 2016 across the top five sectors with retail, distribution and haulage being the top of the list.”