The European automotive and chemical logistics sectors have been hit hardest by the present economic downturn and will not recover to pre-recession levels before 2012, according to figures published today in the latest report by Transport Intelligence, European Vertical Sector Logistics 2009. The automotive logistics market in particular felt the full force of the slowdown, severely impacted by production levels slumping by over a quarter in 2009.
However it has not been all bad news for the contract logistics industry and the report identifies those sectors set to outperform the rest of the market. The pharmaceutical logistics sector will be the industry's star performer, showing consistent growth throughout the period and achieving a Compound Annual Growth Rate (CAGR) of 2.4%. Even this rate is much lower than that experienced in the past five years when the sector achieved an annual growth rate of 7.8%, based on strong underlying volume growth and out-sourcing.
Other sectors which have performed robustly in these difficult economic times include the consumer and retail sectors. In particular sales of FMCG products and groceries have held up consumers are still buying the essentials. This has meant that the major contract logistics specialists, with high exposure to downstream distribution for multi-national brands and supermarkets, have been reasonably well protected from the downturn. However the sub-sector of consumer durables has been far worse affected; production levels have declined by over 20% since mid-way through 2008 - although the rate of decrease has now started to level off.
According to John Manners-Bell, Ti's Chief Executive, opportunities for logistics companies still exist in the present economic conditions. "There is no doubt that many logistics companies with high exposure to the most cyclical industry sectors have taken a battering over the past year. However, much of the European contract logistics industry is underpinned by more stable volumes which should allow it to come out of recession largely unscathed. The market leaders will already be identifying how they can take advantage of the upturn, and in which sectors they should be playing."
About European Vertical Sector Logistics 2009
During this time of exceptional economic downturn, it is even more important for contract logistics companies to be aware of the trends in the vertical sectors in which they operate. European Vertical Sector Logistics 2009 not only tells you the main trends and developments affecting the logistics market in the major industry sectors, but it also provides market sizing and forecasts. The report analyses underlying production figures to give an essential insight into sector cyclicality or secularityand quantifies the impact of the downturn right up to the mid-point of 2009. It also includes overviews of the leading logistics players operations in each sector.
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