According to ING Bank, European road haulage is slightly picking up after a serious downturn. Economic stagnation – especially in Germany – will, however, limit growth in transport volumes and investment in trucks and trailers in 2025. Cost control is key, and the importance of sustainability is rising. Attracting drivers could once again prove a crucial success factor.
Europe’s road transport market
Europe’s road transport market is dominated by fixed transport contracts, with shippers covering most of the traffic. Spot rates – covering perhaps 20% of the market – provide short-term market guidance, though. These day-to-day rates slipped below contract rates in early 2023, revealing market weakness and excess capacity.
However, signs of a market recovery appeared in 2024 as several large fleet owners reduced their (idled) fleet capacity. The newest setback seen in the third quarter is likely linked to significantly lower diesel prices. Freight rates remain fragile in the current environment, and given ongoing wage cost pressures, haulage companies are still challenged to pass on higher costs in 2025.
Zero-emission heavy-duty vehicles (HDVs)
Just under 2.900 zero-emission heavy-duty vehicles (HDVs) were sold in Europe in the third quarter of 2024: 700 heavy trucks (above 12 tonnes), 1,000 light and medium trucks (below 12 tonnes), and 1,200 buses, according to data from ICCT and ING.
Sales of zero-emission HDVs fell from 4.200 in the preceding quarter amid a contraction in the broader HDV market, which saw sales of 74.000 in Q3, down from 110.000 in Q2. This left the sales share of zero-emission HDVs primarily unchanged at 4.0% in Q3 compared with 4.1% in Q2 2024 (the sales of diesel HDVs remained at 96%). At the same time, the sales share of zero-emission heavy trucks rose from 1.1% in Q2 to 1.2% in Q3, the share of zero-emission light and medium trucks rose from 9.9% to 10.4%, and the share of zero-emission buses shrunk from 18% to 14%.
The drop in zero-emission bus sales was partly driven by contractions in major markets, including Germany (where sales dropped by a third) and France (dropped by two-thirds), and in part due to unusually high sales of zero emission buses in smaller Member States in Q2 2024. Although Ireland, Greece, and Denmark made up 30% of zero-emission bus sales in Q2, the same three countries were just 4% of zero-emission bus sales in Q3 2024.
European demand for transport equipment
European demand for transport equipment has cooled, according to ING Bank. Following three years of supply chain issues and subsequent recovery, reduced orders and cleared backlogs are expected to lower deliveries in 2024-25. The trailer market, which saw this earlier, is set to stabilize in 2025. Expect more zero-emission vehicles due to ambitious CO2 regulations. The European market for electric trucks will gear up in 2025 because of CO2 regulations for manufacturers and the start of production in larger series. Emissions reporting (CSRD) and mileage charging will take it further from the demand side, although e-trucking remains more costly. To support the adoption of electric trucks, suitable charging infrastructure is essential, as public fast-charging points for trucks are currently scarce.
After a surge in investments and delayed deliveries, the momentum for new trucks and trailers has slowed. With a drop in transport demand, many carriers are now dealing with excess capacity and are pulling back. Manufacturers relied on pandemic-era backlogs, but as order books have normalized, the drop in orders has become more evident this year. Trailer purchases had already started their decline.
Normalizing elevated prices, improving the transport market, and catching up replacements may boost investments and orders by late 2025. Still, a material market improvement is only expected by 2026. All eyes next year are on the accelerated inflow of electric long-haul tractors.
Europe’s road transport market perspective
The European road haulage sector includes several large international trucking companies such as Girteka, Warberer’s, Primafrio, Raben, and Vos Logistics. However, the majority are still small and medium-sized companies. Larger trucking companies are getting bigger, and more drivers are starting their own companies. In 2024, ING noticed increased bankruptcies amid continued cost pressure alongside disappointing demand in some segments.
However, several companies still lean on their strengthened financial positions from the years before 2023. Given lower borrowing rates, we may see a bolstered flow of acquisitions. Scale is also becoming increasingly crucial for effectively keeping up with and progressing in digitalization and sustainability (fleet and reporting), says ING.
Source: ICCT and ING