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Freight transport will be 'shaken out'

9th October 2008
Page 7
Page 7, 9th October 2008 — Freight transport will be 'shaken out'
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Which of the following most accurately describes the problem?

RISING FUEL costs and lower demand will result in a "shakeout" in freight transport, according to an analysis of business trends by auditor PricewaterhouseCoopers (PWC). with distress sales and exits marking the future.

Despite yet another prediction of grim times in the sector, the report also highlights waste logistics and final-mile deliveries as growth areas.

The professional services firm reveals a current key feature of transport, distribution and logistics is consolidation and lists Brake Bros, Christian Salvesen. TDG. Eddie Stobart and EWS as examples of firms integrating within the last 18 months.

PWC says the trend towards multimodal transport and logistics is being driven by customers demanding flexibility and supplychain efficiencies. It cites the £138m reverse takeover of Eddie Stobart by Westbury Property Fund as an example of a "need for size and the integration of all modes of industrial logistics". But the auditor warns that many companies are trading on thin margins and will be pushed to the wall by the economic slowdown and spiralling fuel prices.

It adds: "Conversely, a growth area within the sector is waste logistics, with customised solutions required for recycling plastic, glass and paper, in both the commercial and municipal sectors.

"Final-mile logistics is another interesting area. Investment is needed on the back of the growth in internet-based home shopping."


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