Category Intelligence on Transportation Thailand covers the following
The country has more than 1 million trucks operating in the market, but the shippers are provided with a limited number of logistics service providers, who can provide integrated logistics services.
Road freight is the dominant mode of transportation, transporting more than 85 percent of the country's goods and is highly fragmented, due to a large number of individual truck owner operators.
Market Overview of Thailand Road Freight
The Y-o-Y increase in the total number of registered trucks in the market indicates that the road freight market is unlikely to fall short of supply in the near future and shippers need not look for alternative mode of transport for freight movements.
Individually registered trucks outweigh the number of company owned trucks, which highlights the fragmented nature of the market and the scenario is unlikely to change in the immediate future.
Service Provider Landscape Registeration(Based on Registration)
Number of Registered Trucks (2008–2017)
While the government has increased its investments on road and rail infrastructure, the country's geographical nature limits the movement of goods through rail and provides shippers with road freight as the preferable mode of transport of goods.
Government's increased investments in road infrastructure highlights the importance of road transportation over other modes of transport and will also reduce the overall logistics cost in terms of road transport.
Thailand Spending on Surface Infrastructure (2007–2016)
While the industry has seen an increase in the number of truck registrations in the last few years, maintenance cost of trucks has not come down, due to large number of old fleet and has impacted the freight rates.
During peak seasons, logistics companies outsource part of the requirement to individual truck operators and also pay higher salary to manage shortage of skilled drivers.
Fuel Cost: Fuel contributes to almost one third of the overall operating cost, which is mainly attributed to the older age of the fleet. Despite increase in number of overall truck registrations, independent truckers find it hard to replace their own trucks.
Maintenance Cost: Average age of fleet is 11 years, leading to higher maintenance cost of the trucks. Apart from old fleet, inefficient road conditions also contribute to lower mileage and reduced efficiency.
Driver Wages: With increase in the shortage of skilled truck drivers, trucking companies pay additional salaries during peak seasons to meet the demand.
Complimentary 12-month access to Beroe LiVE
COVID-19: Assess impact on your suppliers and ensure business continuity with Beroe’s WIRE
(World Instant Risk Exposure)