Gunnar Gburek from TIMOCOM with 12 Logistics Trends for 2024

The challenges facing freight forwarders, transport companies, as well as trade and industry in the coming year are diverse. In 12 points, Gunnar Gburek, Head of Business Affairs at TIMOCOM, identifies significant trends in the transport world and their impact on the future of logistics in Germany and Europe.

(Erkrath) The year 2024 brings several challenges for transport companies and their customers. In particular, it will become evident throughout the year how individual trucking companies cope with the toll increase. Gunnar Gburek from the transport platform TIMOCOM outlines in 12 theses what could happen in the coming year.

Transport prices rise due to toll increases

Due to the immense increases in the toll in Germany and corresponding plans in other countries, the price for truck transports will exceed the levels of recent years. A transport price increase of up to 12% is to be expected. The high costs will not be fully passed on to end consumers; parts of them will have to be borne by transport service providers, industry, and trade. There will be much bargaining over the costs incurred for empty kilometers and who will bear them.

Carriers face rising personnel and operating costs

Additional costs for operating real estate, vehicles, and the already increased costs for personnel resources, etc., will limit transport companies’ ability to pass on these costs in addition to the toll. Carriers and freight forwarders will bear these costs. Achieving a more efficient utilization to somehow maintain the already low margins will be challenging given the current economic situation.

Share of low-emission vehicles will hardly increase in 2024

The share of low-emission vehicles will hardly increase in 2024, as there are few vehicles available on the market, and there is also significant skepticism among carriers about which technology will be right for their business in the future. 2024 will be a year in which most companies will hold back on investments in new drive technologies, waiting to observe the “first movers.” The experiences with LNG are still too fresh in memory. However, transport companies are increasingly encountering clients who desire low-emission vehicles to reduce toll costs and their CO2 footprint. This dilemma will shape the discussion about the feasibility of future technologies.

Drivers remain scarce and personnel costs high

In 2024, it will generally be somewhat easier to find personnel for warehousing and administration. Drivers, however, remain scarce, and it will still be difficult to find trainees in all areas. Overall, personnel costs will remain consistently high after salaries were widely increased in 2023.

Partial and additional loads gain importance

The declining economy leads to less transport demand and a smaller volume of individual deliveries, resulting in decreased demand for cargo space. This can primarily be managed by companies that work efficiently and flexibly pick up any additional loads they can get. The simpler FTL (full loads) will be fiercely contested in terms of pricing, while partial load transports are expected to be somewhat more lucrative.

Number of tenders will massively increase

The reluctance to participate in tenders in 2023, due to concerns about receiving significantly worse conditions than before or possibly no offers at all, will decrease in 2024. The industry will be flooded with a wave of tenders. On the one hand, buyers must regularly tender, as expiring contracts are sometimes not extendable; on the other hand, they hope for price-reducing competitive situations. Tenderers will likely benefit from this, as many companies will try to secure every order they can during times of crisis.

Balanced ratio of transport capacities

In 2023, the ratio of freight to cargo space averaged about 60 to 40, making it somewhat more balanced compared to previous years. In 2024, we will not return to the ratios seen at the end of the COVID-19 pandemic, when many transport capacities were extremely utilized. Carriers who entered into more long-term contracts during the previous years of high demand will again rely more on ad-hoc business. It could be the year of freight exchanges and platforms.

More bankruptcies, but hardly any capacity losses

Overall, capacities remain the same, but the number of companies will decrease. Companies that go bankrupt or cease operations will be taken over by the competition. This will lead to further consolidations, but there will be virtually no new players entering the market. Drivers prefer to be employed rather than becoming self-employed. The conditions and future prospects for starting a business will still be too poor in 2024.

No increase in shifting to rail

Shifting transport to rail, especially in combined transport, will still be on the wish list of many shippers and freight forwarders in 2024. However, the realization will hardly progress. Massive route restrictions due to construction sites, lack of personnel, insufficient capacities at terminals, and not least the limitations posed by non-craneable trailers hinder a significant shift to rail. If the current level of rail freight transport can be maintained, much will have been achieved.

Confusion and a lot of effort due to legal regulations

The effects of the Supply Chain Due Diligence Act (LkSG) will become clearly visible for the first time in 2024, as since January 1, companies with more than 1,000 employees must now conduct and document risk analyses along their supply and transport chains. New businesses are already sensing numerous certifiers and consultants who want to benefit from the legislative initiative. Many small and medium-sized transport companies will face a flood of verification requests and requirements from their reporting clients. If clear guidelines from BAFA do not emerge soon, this topic will provide plenty of discussion material in 2024.

IT security and increase in hacker attacks

Information technology security will be a topic like never before in 2024. The threat to IT systems from hackers will increase massively. As investments in prevention and defense at most small and medium-sized enterprises are far from the standard that would be appropriate and necessary, many hackers will be successful. Affected companies, both on the client and contractor side, that have not made preparations for this eventuality could face economic difficulties.

Warehouse logistics: Regional differences in the warehouse and logistics space market

After warehouse capacities were largely in short supply everywhere in 2023, the situation in the real estate market will develop regionally differently in 2024. While the situation in rural areas will ease due to vacancies and new constructions that will soon be available to the market, warehouse capacities will still be tight in urban areas. The scarcity will also persist this year in the context of specific properties, such as those for hazardous materials.

Photo: © TIMOCOM