2013-02-02 16:05:15 - New Transportation research report from Business Monitor International is now available from Fast Market Research
BMI View: Things Looking Up - Very Slowly
Looking across 2012 and 2013, economic prospects in the Netherlands are unexciting. Amid the eurozone crisis and a stuttering world economy, we estimate that the country's GDP will contract by 0.6% in 2012, and forecast that it will recover - also by 0.6% - in 2013. The improvement in 2013 will, we believe, be based on a new wave of global monetary and fiscal stimuli, which will help Europe in general and the Netherlands in particular. While statistically unremarkable, it is movement in the right direction which is to be welcomed, but at the same time it has to be highlighted that growth is marginal. BMI notes that economic growth in the country
is not forecasted to push up beyond 1% until 2015.
In spite of the less than inspiring outlook for the country's economy, we also note that in 2013 we expect most freight transport modes to see cargo volume growth of some kind. In almost all cases, in fact, tonnage growth will exceed the general rate of GDP expansion. There are various reasons for this, with perhaps the most important being the country's role as a gateway into northern Europe. This means that freight demand reflects not just the fortunes of the Dutch economy, but also those of a number of betterperforming neighbours such as Germany.
Full Report Details at
- www.fastmr.com/prod/529438_netherlands_freight_transport_report_ ..
Headline Industry Data
* Port of Rotterdam bulk throughput forecast for 2013: growth of 3.9% to 460.412mn tonnes. Container traffic to contract by 5.4% to 12.396mn twenty-foot equivalent units (TEUs).
* 2013 Port of Amsterdam bulk throughput forecast to grow by 2.2% to 74.431mn tonnes. Container traffic to grow by 4.5% to 49,195 TEUs.
* 2013 rail freight total tonnage volume growth to come in at 6.9% to reach 45.916mn tonnes.
* 2013 total trade growth forecast set at 2.8% in real terms, similar to 2012.
* Export growth remains sluggish, at 2.5%, according to both 2012 estimates and 2013 forecasts.
Key Industry Trends
Port Of Rotterdam Cuts Shipping Fees
To pull through tough times, it is often necessary to become more competitive - and reduce charges. That seems to be the lesson learned by Rotterdam, Europe's largest container port, which is seeking to halt its box throughput decline in 2013, offering carriers the enticement of lower fees. In BMI's opinion the strategy will, along with a stronger macroeconomic outlook in Europe, encourage throughput growth at the port. We also highlight that the move reinforces Rotterdam's determination to remain competitive, as although it is the largest box port in Europe it has lost market share, and with the launch of a deep water port in Germany - the JadeWeserPort, in 2012 - it faces further competition.
Turning A Corner At Air France-KLM?
After a series of capacity reductions, Europe's largest airline may be in the early stages of recovery. French-Dutch airline Air France-KLM reported a 27% increase in operating profit to EUR506mn (US$656mn) in Q312 compared with the previous year. The company has also announced that it will make 1,300 fresh redundancies across its Dutch operations. This is in addition to the previouslyannounced 5,000 job cuts it is making at its French business.
TNT Offering Good News For UPS
As US package delivery company UPS continues its US$6.8bn takeover bid for TNT Express, the Dutch company announced good results in both Q2 and Q312. TNT celebrated its best customer satisfaction result ever in Q312, with improved volume growth in Europe and better operating income from its Asia Pacific business. Revenues were up 2.1% y-o-y to EUR1.814mn (US$2.35mn) and results in the Americas improved. On the other hand, TNT cautioned that the challenge of making its Brazil operations profitable was proving more difficult than predicted.
Key Risks To Outlook
The main downside risk to our Netherlands freight projections continues to be the eurozone crisis. As we have been saying in various editions of our recent quarterly reports, any worsening of the sovereign debt crisis would have a negative knock-on effect on the economy, and therefore on freight demand. However BMI is reasonably confident that 2013 will see the beginning of a European recovery. The crisis is not yet over - but the conditions for recovery are gradually improving. It follows therefore that the probability of this downside risk materialising is beginning to fall.
We have also been mentioning domestic political risk, focused around the September 2012 general elections. These polls have been and gone, and a new centrist coalition government is now in place. The fears of the business and investment community that the Netherlands might slip into a more narrow nationalist, anti-immigrant, and euroscpetic mode have largely been put to rest. So here too we believe the risk has become less serious. However we note that there is still a possibility of some quite strong leftright policy disagreements within the coalition government.
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