The instability in Ukraine and the plummeting oil price have had a devastating impact on the outlook for trailer demand in Eastern Europe, according to UK consultancy Clear International.
After reducing the forecast for Ukraine, Belarus and Russia in 2014 following the annexation of Crimea, Clear now cut its growth outlook again.
Nearly 24,000 trailers have been wiped from the demand forecast for the 2015-19 period – with most of that falling in 2015-16.
According to Clear Managing Director, Gary Beecroft, in the second half of 2014 it was believed that the conflict in Ukraine would lessen and a solution would be found.
“This proved to be too optimistic. Despite a ceasefire agreement being reached it has never been fully implemented. The low price of oil, combined with international sanctions against Russia, have pitched the county into recession,” he said.
As a consequence, Russia – always the largest market for trailers in Eastern Europe until 2010 – has now fallen behind Turkey and Poland. Similarly, the Ukraine and Belarus have been overtaken by Hungary and the Czech Republic.
Despite trailer demand falling by 4.7 per cent in 2014 in the region, Beecroft found this was caused by a large drop in sales in only five countries at the same time as nine other countries enjoyed substantial growth close to 14 per cent on average, and just below the growth level of Western Europe.
“A similar situation will prevail in 2015 with 11 countries experiencing modest growth,” he explained.
“The economic forecast is for two years of positive GDP and investment growth in 2016/17, which will result in recovering levels of trade and more demand for road transport.”
For the long term, Beecroft is still optimistic: “Despite the problems in the Ukraine and Russia, the East European trailer market can grow in 2016-17 if matters settle down during the coming months. By 2017 new trailer demand for the region will be back at the pre-recession level of 2006.”