OLYMPICS COULD PROVIDE BOOST TO DOMESTIC ROAD FREIGHT ACTIVITY SAYS FTA







Published by Gerald Ferreira Date: August 22, 2012
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Growth in domestic road freight activity remained weak in the second quarter of 2012 according to the Freight Transport Association’s latest Quarterly Transport Activity Survey (QTAS).  The slight growth in activity reported was much lower than that predicted in the previous quarter’s QTAS report, although respondents said that they anticipated growth to be stronger in the third quarter of 2012, suggesting there is hope that the London 2012 Olympics will provide a boost to the economy.

The FTA figures also found that growth in domestic road freight activity in Q2 2012 coincided with a fall in the number of road freight operators declaring insolvency in the quarter compared to the previous quarter. According to the Insolvency Service, the number dropped by 22% in Q2 compared to Q1, and since the start of 2011 the longer term trend is also downwards and is now at an all time low.

The outlook for the third quarter of 2012 is more optimistic with a number of sectors anticipating growth.  The strongest levels of growth are expected in the wholesale and recycling and waste sectors.

There was little growth in domestic road freight activity reported by respondents based outside of London and the South East in Q2. Most regions reported activity at variance with the levels anticipated in the April 2012 QTAS report. Weaker than anticipated domestic road freight activity linked to manufacturing was particularly evident in the Midlands and the North where the largest variance was reported.

However, again the outlook for Q3 2012 is more optimistic with only respondents in Wales and the South West expecting a fall in activity. With respondents in London and the South East consistently reporting growth that outperforms most other regions, it may reflect that the region is more reliant on the service sector than manufacturing as well as anticipating benefitting from the Olympics.

FTA Research Analyst, Bruce Goodhart, said:

“Hauliers continue to be squeezed by the effects of weak freight volumes as customers are affected by the slowdown in consumer demand.  The mood of the country was lifted by Team GB’s success in the London 2012 Olympics and hopefully this will lead to an improvement in demand and the economy in the run up to Christmas