Rate changes in 2019: what to expect?

The start of a new year is always accompanied by new developments, and it is traditionally the time when any rate changes come into effect. It is important for companies in the transport and logistics sector to be aware of such changes, which is why in this article we outline what rate changes to expect in 2019.

Facts and figures

Research firm Panteia/NEA investigated how tariffs will change in the transport sector in the coming year and came up with the following findings:

  • In 2019, the labour costs for drivers in the Netherlands are expected to increase by 6.73%. This percentage is made up of the pay rise stipulated in the collective labour agreement, the addition of an extra increment to the salary scale, changes in taxes and social security contributions and an adjustment to the compensation for bonuses and overtime. Moreover, the continued shortage of drivers is also leading to higher labour costs.
  • Insurance premiums (third-party and comprehensive) are expected to rise by 8.4% compared with 2018.
  • For other general costs, Panteia sticks to the general price increase which is quantified at 2.4%.
  • The German toll (Maut) will rise on 1 January 2019, which will result in a substantial increase of the kilometre charge – which was previously extended on 1 July this year. The extra costs in Switzerland, the Czech Republic, Slovakia and Poland will also increase by a few percent of the cargo price, depending on the route.
  • The average diesel price in the Netherlands for the whole of 2018 will be around 10% higher than the average for 2017, and in France that percentage will be as high as 17%. Dutch bank ABN Amro expects the oil price to rise further in 2019, by as much as 9%. The French government was planning to raise environmental tax as of 1 January but, after weeks of protest by the Yellow Vest movement, President Macron has now decided to completely remove the ecotax hike from the country’s budget in order to prevent the unrest from escalating further.

Rate increases drive supply chain collaboration

Based on these figures, transport and logistics activities are expected to become significantly more expensive. How can you stay profitable in the face of rising costs?

Over the past year at IDS, we have been exploring ways in which our customers can benefit from supply chain collaboration. Our research revealed the potential for a 14% cost reduction for all shippers if we could achieve full horizontal collaboration. In other words, supply chain collaboration now makes more sense than ever for shippers, not only in terms of huge cost savings but also in the context of reducing kilometres and CO2. Meanwhile, in the context of Brexit, supply chain collaboration for shipments to and from the UK can offer benefits and reduce the risks of disruptions to supply.

Arno Spoek, Business Development Manager at IDS, comments: “Our Control Tower gives us insight into the dynamic relationships between shippers and end customers. This has revealed that a shared problem forms the basis for successful supply chain collaboration. There needs to be a clear business case supported by all sides, and they then have to jointly develop an implementation strategy to turn their collaboration into reality. At IDS we’re currently developing business cases per shipper and per chain so that we can provide our customers with details of the concrete benefits of supply chain collaboration. We will then reach agreements with the shippers and partners in the vertical supply chain to actually make it happen.”

Keen to know more about supply chain collaboration? Listen to the second Logistics & Innovation podcast to hear IDS Business Development Manager Arno Spoek and other specialists explain more, or contact Arno directly: arno.spoek@idsnl.com or +31 (0) 88 437 4370.