July 2024

Industry trends
Transportation and logistics
Industrial production
and consumer demand
support sector
performance

Global overview
Solid sector growth continues in 2024 and2025.
In 2024 we expect global transportation andlogistics output to grow by 3.8%, followed by
a 4.0% increase in 2025. The sector should
benefit from higher worldwide industrial
production and consumer demand. In
particular, the economic recovery inEurope this year and next should support
transportation and logistics demand.

Oil and fuel prices have decreased again aftera brief surge in early 2024, which shouldease cost pressures for transport and logistic
businesses in the coming months.

rates will remain elevated in the coming
months, price pressures should decrease
somewhat due to added capacity in theform of new ships.

Prices for international shipping along key
routes have substantially increased (about
60% higher in Q1 of 2024 compared to 2023).
The de facto closure of the Suez Canal routedue to the Red Sea Crisis has led to lower
capacity, as rerouting around Africa adds
at least a week or two for journeys from
Asia to Europe and America. While freight

In order to improve their resilience, manybusinesses that once focused on justin-time production have started to keep
greater levels of inventory as a safety
buffer. This should lead to increasing
demand for warehouse storage facilities
in order to store inventory and to avoid
delays.

Asia and Oceania

AmericasIndustry performance forecast
Europe1Austria

Netherlands

Australia

Phillippines

BrazilBelgium

PolandChina

Singapore

CanadaCzech Republic

PortugalHong Kong

South Korea

MexicoDenmark

Slovakia

India

TaiwanUSA

FranceSpain

Indonesia

ThailandGermany

SwedenJapan

UAE

Hungary

Switzerland

Malaysia

VietnamIrelandTurkeyNew Zealand

Italy

UK

Excellent
The credit risk situationin the sector is strong /business performance in the
sector is strong compared toits long-term trend.
Good
The credit risk situationin the sector is benign /business performance in the
sector is above its long-term trend.
Fair
The credit risk situationin the sector is average /business performance in the
sector is stable.
Poor
The credit risk in the
sector is relatively high /business performance in the
sector is below its long-term trend.
Bleak
The credit risk in the
sector is poor / businessperformance in the sector is weakcompared to its long-term trend.

July 2024

Industry trends
Transportation and logistics
Transportation andlogistics output per
region

2022

2023

2024*

2025*

6.6

5.0

3.8

4.0

2.7

2.8

Global

4.7

Global transportationand logistics output
per subsector

Land transport

2022

2023

2024*

2025*

4.4

4.6

3.7

3.8

3.2

1.4

12.4
4.0

Americas

Water transport
19.2

5.6

8.7

5.9

Air transport
9.1

Europe13.8

5.0

Asia Pacific

1.0

1.9

3.1

Warehousing,support, courier,postal services

5.0

5.6

2.8

5.9

5.7

3.6

3.4

Year-on-year, % change /*forecast – Source: Oxford Economics

Year-on-year, % change /*forecast – Source: Oxford Economics

Strengths and growth drivers

Constraints and downside risks

Growth in global trade. Despite some reshoring, global trade is
projected to continue growing, supporting demand for both freightand passenger transport in both the mid-term and long-term.

Oil price volatility. High fuel prices negatively affect margins oftransport and logistics businesses across all segments.

Supply chain resilience. Industries focusing on just-in-time
production may keep greater levels of inventory as a safety buffer.
This will create demand for warehouse storage facilities.
New technologies. Increasing investment in warehousedigitalisation, robotics, and data is expected to increase supply
chain efficiency and reduce costs. Investment in smart tech will
help transport businesses improve transparency and flexibility.
Growth in ecommerce and digitalisation. This will support demandfor courier services and warehousing facilities.

Sustainability. Growing demand for green transport will requiresignificant investment in both the mid-term and long-term. This
will create opportunities, but also pose a risk for companies unable
or unwilling to adapt. If passed on to consumers, increased costs inthe form of new regulations or carbon taxes are likely to negatively
impact sector demand.
Geopolitical risks. The maritime subsector relies heavily on
freedom of navigation. Disruptions could be caused by risingtensions or armed conflicts like those currently happening in the
Red Sea and potentially in the Taiwan Strait and South China Sea.
Staff shortages and labour disputes. In some segments like roadtransport this could impact activity and growth, adding upwards
pressure on labour costs.

2

July 2024

Transportation and logistics outlook
AmericasTransportation and logistics output

2022

2023

2024*

2025*

Brazil

8.0

2.6

1.4

2.2

Canada

13.0

6.1

3.5

7.3

Mexico

12.2

3.4

3.5

3.1

CanadaUnited States

2.0

4.4

2.7

2.0

MexicoYear-on-year, % change /*forecast – Source: Oxford Economics

USA
Robust private consumption drives
transport growth
We expect the US transportation and logistics
industry to grow by 2.7% in 2024 and by 2.0%
in 2025. This sector growth is lower than
the 4.4% increase last year, but still higher
than annual GDP growth over the same
period. While transportation and logistics
businesses benefit from decreasing energy
costs, labour costs have increased.
Private consumption in the US remains
robust, growing by 2.4% in 2024 and 2.0%
in 2025. This supports demand for shippingof durable and non-durable consumer
goods. Containers heading to US ports are
increasing after a rather disappointing 2023.
Air and train freight data are also showing an
uptick in volumes.

3

Trucks are the key transport mode for goodsin the US. There are currently signs of apotential bottoming out in trucking, setting
the scene for recovery in the coming months
amidst stronger consumer demand forgoods and ongoing retail sales growth.
Compared to Europe, overseas trade with the
US is less vulnerable to shipping disruptionsin the Red Sea. That said, prices for container
freight shipping from Asia to the US havesubstantially increased in spring 2024,
as longer ocean transits have resulted incontainer capacity issues. However, theimpact on consumption and US transport
performance should not be substantial.
In the mid-term, government investment ininfrastructure improvement will benefit thesector by promoting greater supply chain
efficiency, reducing costs, and stimulating
demand for transportation and logistics
services.

Industry performance forecast
BrazilUSA
Excellent
The credit risk situation in the
sector is strong / businessperformance in the sector is strong
compared to its long-term trend.
Good
The credit risk situation in the
sector is benign / businessperformance in the sector
is above its long-term trend.
Fair
The credit risk situation in the
sector is average / businessperformance in the sector
is stable.
Poor
The credit risk in the sector
is relatively high / businessperformance in the sector
is below its long-term trend.
Bleak
The credit risk in the sector ispoor / business performancein the sector is weak compared
to its long-term trend.

July 2024

Transportation and logistics outlook
Asia Pacific
Transportation and logistics output

2022

2023

2024*

2025*

China

0.7

7.8

4.8

5.4

India

8.5

5.5

12.0

7.4

Japan

14.2

10.6

5.9

2.3

Australia

15.1

7.5

2.3

3.4

Year-on-year, % change /*forecast – Source: Oxford Economics

Industry performance forecast
Australia
China
Hong Kong
India
Indonesia

China

India

Healthy growth outlook over the coming
years

Growing household spending supports
strong sector growth

Chinese transportation and logistics
output is forecast to grow by 4.8% in 2024
and by 5.4% in 2025. After a weak 2023,
imports and exports of goods are trending
upwards. Despite the risks associated withrising tariffs, external demand for Chinese
products is increasing, supporting freightcargo transportation.

Indian transportation and logistics output
is forecast to grow by 12% in 2024 and by
7.4% in 2025. One major growth driveris increasing demand from key export
destinations, such as the US.

We expect the sector will benefit fromgovernment support for businesses andinvestment in infrastructure in the coming
years. Those investments show China´sambition to ensure that it remains a major
hub in global supply chains and logistics.
The ongoing expansion of ecommerce islikely lead to increasing demand for courier
and storage facilities. Increasing GDP per
capita and rising household incomes willsustain demand for domestic transport
services.

Japan
Export growth supports all main transport
segments
We expect Japan´s transportation andlogistics output to grow by 5.9% in 2024
and by 2.3% in 2025. Industrial production
is set to recover after a major slump in Q1of 2024, and export growth will continue
in the coming 18 months. This will support
freight transport demand on land, waterand in the air. The passenger transport
segment has benefited from strong tourism
inflow and a resurgence in domestic air
travel.

4

India’s growing middle class is also spurring
demand for consumer goods, supporting
land, sea and air transport. In the coming
years households are expected to increasespending for travel and leisure, which should
benefit the passenger transport segment.
The ‘Make in India’ campaign promotes thecountry as a manufacturing hub for both
domestic and international companies. Thisshould support higher freight volumes in
the mid-term. However, more investment
in transport infrastructure is required
to overcome existing inefficiencies andbottlenecks.

Japan
Malaysia
New ZealandPhillippines
Singapore
South Korea
TaiwanThailand
UAE
Vietnam
Excellent
The credit risk situation in the
sector is strong / businessperformance in the sector is strong
compared to its long-term trend.
Good
The credit risk situation in the
sector is benign / businessperformance in the sector
is above its long-term trend.
Fair
The credit risk situation in the
sector is average / businessperformance in the sector
is stable.
Poor
The credit risk in the sector
is relatively high / businessperformance in the sector
is below its long-term trend.
Bleak
The credit risk in the sector ispoor / business performancein the sector is weak compared
to its long-term trend.

July 2024

Transportation and logistics outlook
EuropeTransportation and logistics output

2022

2023

2024*

2025*

France

4.9

-2.0

0.2

4.2

Germany

6.1

2.2

-1.3

1.1

Italy

17.5

2.4

0.3

1.1

Belgium

United Kingdom

13.7

-1.3

4.4

2.7

Czech RepublicYear-on-year, % change /*forecast – Source: Oxford Economics

Industry performance forecast
Austria

Denmark
FranceEurozone

United Kingdom

A rebound on the horizon

Business sentiment is still weak

We expect transportation and logistics
output in the Eurozone to grow by just 0.6%
in 2024, followed by an acceleration of
2.7% in 2025. The economic recovery in theEurozone should gain momentum in the
coming months, with private consumption
and retail sales recovering, as a morebenign inflationary environment supports
consumers’ purchasing power. The currently
ongoing normalisation of export growth isexpected to continue (1.4% increase in 2024
and 3.4% in 2025).

After a 1.5% contraction in 2023, we expect
UK transport and logistics output to growby more than 4% in 2024, mainly due to arobust sector performance in H1 of 2024. The
economy grew stronger than expected in thisperiod, with consumer spending acting as themain driver.

Only a modest recovery expected in 2025

However, the economic recovery is forecast
to be weaker in the coming months, as
headwinds from tight fiscal policy and pastinterest rate hikes weigh on demand. This
corresponds with a weak business sentimentamong British transport and logistics
businesses, both in the freight and passenger
segments.

In Germany, the largest Eurozone market,
we expect transport and logistics output
to contract by 1.3% in 2024. This subdued
performance is in line with stagnating
economic growth (0.9%) a 1.4% industrial
production decline.

Transport and logistics output growthis expected to slow down in the coming
months. The sector has to cope with ongoing
staff shortages and loss of cabotage rights inthe EU, which are both likely to limit sector
activity.

Germany

However, we expect the German economy tostart to rebound towards the end of the year.
This should help growth in manufacturing
and the consumption of domestic goods,
which should lead to a transport and logistics
sector rebound, albeit modest at 1.1%.
Additionally, the German transport andlogistics sector will continue to struggle withstaff shortages and fierce competition fromCentral and Eastern Europe. This mainly
affects the road freight transport subsector.

5

Germany
Hungary
Ireland
Italy
Netherlands
PolandPortugal
Slovakia
Spain
SwedenSwitzerland
TurkeyUK
Excellent
The credit risk situation in the
sector is strong / businessperformance in the sector is strong
compared to its long-term trend.
Good
The credit risk situation in the
sector is benign / businessperformance in the sector
is above its long-term trend.
Fair
The credit risk situation in the
sector is average / businessperformance in the sector
is stable.
Poor
The credit risk in the sector
is relatively high / businessperformance in the sector
is below its long-term trend.
Bleak
The credit risk in the sector ispoor / business performancein the sector is weak compared
to its long-term trend.

July 2024

Atradius
David Ricardostraat 1 · 1066 JS Amsterdam
P.O. box 8982 · 1006 JD Amsterdam
The Netherlands
Phone: +31 (0)20 - 553 91 11
info@atradius.com
www.atradius.com

Copyright © Atradius N.V. 2024
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6

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