A new forecast report issued by consultants CLEAR shows that heavy trailer demand in Eastern Europe will fall by 4.9% in 2013 following a similar fall in 2012. This is a worse outcome than was anticipated at the beginning of the year when a small amount of growth was anticipated. The cause is a general worsening of the economic outlook for the region, with GDP growth figures having been downgraded since the beginning of 2013.
A variety of market drivers are operating in the region. Clearly the sluggishness of the West European economy is affecting exports from the east. Some countries are suffering from the hangover arising from the 2009 recession. Others expanded so rapidly in the period from 2004 to 2008 that they have enough equipment to meet the demand for transport. Political instability is affecting consumer and business confidence in some markets.
In some countries that are underperforming economically, trailer registrations are increasing due to the demand for international transport to, from and through the country, even if national transport demand is stagnating or falling. Hungary and Slovenia are two examples.
Countries that have suffered a particularly large drop in their trailer demand forecasts are Russia and Ukraine. Together these two countries account for most of the fall in Eastern Europe in 2013. In percentage terms Bulgaria, Croatia, Estonia and Romania have also suffered significant downgrades.
The countries that have escaped the general downward trend are Latvia, Lithuania, and Slovenia. Their outlooks have improved, if only a little. The forecast for Belarus remains unchanged.
The downgrading of the economic outlook and trailer demand forecast mainly affects 2013/14. From 2015-2017 the prognosis continues to show higher levels of new trailer demand.
Gary Beecroft, managing director of CLEAR commented, “Despite the 2009 recession and the weakness of trailer demand in 2013, Eastern European is forecast to return to the pre-crisis level of demand seen in 2008. The size of the trailer parc (fleet) has increased every year since the 1990s.”
Many East European countries joined the EU in 2004, which resulted in booming demand for trailers. In particular, semi-trailer demand rocketed as the volumes of international transport increased, both within Eastern Europe and between East and West. From 2002 to 2007 the compound annual growth rate for trailer demand was 25.7%. Demand broke the 100,000 unit barrier in 2007 but fell to 40,000 in 2009.
A new report for the West European market was issued in June 2013. The East European Trailer Market Report (October 2013), with forecasts to 2017, can be obtained by e-mailing Beecroft at [email protected].