Saturday 22nd Oct 2016 - Logistics Manager

Vehicle logistics needs 3 to 5bn euro investment

Europe’s vehicle logistics sector needs to invest some 3 to 5bn euros to restore capacity shed in the downturn or risk choking off the motor industry’s wider recovery, according to Costantino Baldissara, president of EGC the Association of European Vehicle Logistics.

Speaking at the association’s annual assembly in Warsaw, Baldissara said: “Demand for new vehicles is on the rise in most of the major European markets, and this will inevitably translate into greater demand for logistics services. Looking ahead, this spells better times for our sector.”

However, he said, logistics service providers cut some 20 per cent of capacity as demand plunged through the economic crisis. Capacity shortages remained, even in countries like Italy where demand has fallen sharply. In addition, rates were under pressure and costs were on the rise, squeezing margins and profits.

Baldissara stressed “the need for 3 to 5 billion euros of investment to restore the capacity shed during the downturn”, this for a sector that, with the exception of a few larger, capital-intensive companies, is barely breaking even. There is a risk that without this investment a lack of transport capacity may choke off the industry’s wider recovery.