The fact that the UK is experiencing increased fuel costs and supply chain issues is not breaking news. However, a major disparity between road freight costs in Greater London and the rest of the United Kingdom may be and this is what’s been highlighted in the latest Transport Price Index issued by the Transport Exchange Group (TEG).

A slight disparity may be explained by the fact that the cost of living in London is higher than in the rest of the country. That said, the Price Index has revealed road freight increases in the Capital have outstripped the rest of the UK by a factor of 2 to 1 over the period of March to April 2022 – placing even more pressure on Britain’s London-based hauliers.

11.6 Points Versus 5.3

In real terms, the average price-per-mile for courier and haulage vehicles in the Greater London area has risen by 11.6 points over just a single month. This is double the increase in road freight costs seen in the rest of the UK, which themselves sit at a more modest, but still significant 5.3 points over the same period of time.

This follows the same trend from 2021 that saw a drop after the usual spike over the festive period and then a month on month increase. What also can’t be ignored are the substantial year-on-year increases, which sit at 16% more than they were just three years ago. Since April 2019, the cost has risen from 100.9 points to a considerable 117.5 points in April 2022.

“Post-Brexit Bureaucracy & Inflation to Blame”

When asked about the reason behind the surging transport costs, the TEG pointed toward post-Brexit bureaucracy, EU import check delays and rising inflation as key factors. Although the group did suggest that these increased costs aren’t being felt by consumers and businesses to the expected extent, as spending has been curbed due to the cost of living crisis.

TEG stated: “With the increased cost of living – notably energy price rises – many consumers are cutting back on their spending to balance household budgets. Consumer confidence has been reported as hitting an all-time low and the ONS announced a 1.4% decline in retail sales in March”

Also contributing to the debate was TEG’s CEO, who added: “We’re continuing to see that the TEG index is a result of many different factors, all of which affect the state of the industry. Haulage and courier businesses have to respond to fluctuations in costs and there will then be knock-on effects for the many industries that work with them.

This isn’t the case in London, however, where price rises in the last month were double the national average. What we have right now then is almost a two-speed situation, with prices in the Capital soaring and relatively low rises elsewhere. What remains to be seen is whether the conditions in London drive up prices around the UK”.

One of Many Challenges to Overcome for UK Haulage

We all knew that returning the UK haulage industry to good health would present many challenges along the way. Rising costs, driven by inflation and EU customs bureaucracy, are certainly making things tougher for haulage operators across the UK, but at HGVC, we will continue to support the industry in any way we can.

One way we will do so is by continuing to provide industry-leading HGV licence acquisition programs via our national network of training centres staffed by the most experienced trainers in the business. To find out more about us and how we work, take a few minutes to browse our website, where you’ll find everything you need to know.

Alternatively, to get in touch with us directly, click ‘contact us’ or call us on 0330 818 8888, and we’ll be delighted to discuss your requirements.