15 November
2024
In recent years, the Polish transport industry has faced a crisis, which forces local companies to massively register business abroad, choosing countries with more favorable conditions. Lardy.Today learned about this from the material published on the wyborcza.biz portal.
Moving to Hungary and Romania is becoming an option for many companies trying to cut costs and remain competitive. Industry representatives and experts warn that if this trend does not stop, Poland could lose a significant part of its transport market and the jobs associated with it.
Today, more than a hundred transport companies in Poland have declared bankruptcy, and about 1,400 enterprises are at the stage of restructuring. These are alarming data that confirm that the crisis in the industry is growing. Anna Brzezinska-Rybytska, a representative of the Association of International Motor Carriers of Poland (ZMPD), notes that the problems became apparent two years ago. According to her, "for the last two years, we have been warning that the industry is facing a wave of bankruptcies." Predictions have come true, and today companies are forced to look for ways to preserve business, in particular, by moving operational bases abroad.
One of the main factors that triggered the crisis was the COVID-19 pandemic. While demand for transportation has increased amid the boom in e-commerce, transportation companies have begun to invest heavily in expanding their truck fleets, hoping for long-term benefits. However, after the stabilization of the situation with the pandemic, the sector faced new challenges related to the increase in fuel prices and the crisis caused by the war in Ukraine. Meanwhile, the prices of tractors and semi-trailers increased by as much as 20-30%, and the market was so in need of trucks that their delivery had to wait up to a year. In addition, prices for financial services such as leasing have increased. Business Center Club expert Mariusz Fronk explains that companies, succumbing to the hype, made too many investments without calculating the possible risks.
"Many companies reinvested without taking long-term risk planning into account. As a result, instead of profits, companies faced a sharp increase in costs, which made their position in the market difficult."
Mariusz Fronk
After the start of the war in Ukraine, almost 400 companies transporting goods to the East lost their orders.
"We are talking about the markets of the Russian Federation, Ukraine, the Republic of Belarus, Kazakhstan and Uzbekistan. Due to Russian counter-sanctions, only a small proportion of goods, such as medicine and live animals, can be transported through Russia. The rest of the goods have to be transported in a detour - through Turkey, by ferry across the Caspian Sea. This triples or even quadruples the travel time, and therefore the cost of transportation."
Karol Ryshlyk, carrier
Another problem is a significant decrease in demand for transport services. This year, the number of orders decreased by 15-20% compared to the previous year. This is the result of the economic recession in Poland and throughout Europe.
Statistics of the Central Statistical Office (Glavstat) in the transport sector are deteriorating: 120 enterprises have already filed for bankruptcy, and 1,400 have undergone restructuring. At the end of the year, when Glavstat publishes full data, the number of bankruptcies may exceed 150, as the debt of the entire industry grows. According to the Register of Debtors BIG InfoMonitor, outstanding debts of transport entrepreneurs have already exceeded 2 billion zlotys or 460.8 million euros (a year-on-year increase of almost 11%). According to the expert, the current problems of the industry are only the tip of the iceberg.
"Polish transport is still surviving thanks to small and medium-sized enterprises, for which saving the family business is a mission, so they borrow money for the next quarters. But the possibilities of financing services are running out, and they will soon hit the wall."
Mariusz Fronk
However, economic forecasts for next year are optimistic. Inflation is expected to decrease (to 3.5%), and the National Bank of Poland may finally lower interest rates.
"But in the first quarter of 2025, entrepreneurs will not feel this. The economy needs to be fed first, but the transport industry has been in recession for six months. Only a few companies have created a financial base. Even a million zlotys is not a financial cushion in the case of transport, as it is a sector of the economy that quickly consumes savings. These companies generate large turnovers, not revenues, and quickly fall below the break-even point.”
Mariusz Fronk
As a result, transport companies are moving their activities to the south of Europe - to Hungary and Romania. The calculation is simple: obtaining a license for transportation in Poland costs 1,300 euros for one car, and the term of its registration is 30 days. It costs 80 euros in Hungary and takes up to 7 days to receive. In addition, Poland's southern neighbors have lower taxes, both on transport and on income. However, the salaries of drivers in the European Union are equal. But not the tax costs of maintaining this employee.
"ZUS contributions have increased, which, along with the increase in road tolls, fuel prices, leasing payments, liability to third partieswe and sum casco led to the fact that fees began to exceed profits"
Anna Brzezinska-Rybytska
For example, in the Czech Republic, where Polish companies also flee, although to a lesser extent (1-2 out of 10 appeals to law firms), due to lower personnel costs, you can save up to 2,000 zlotys (460 euros) per month per employee. If the company employs 50 people, it is easy to calculate how much profit there is from registering the company there.
Mariusz Fronk calls this phenomenon the result of transport from Poland. In 2022, many companies from Lithuania, Moldova, Germany, Denmark and the Netherlands were registered in Poland. There are no data from the Central Statistical Office, but associations keep their own statistics - approximately eight foreign carriers were registered in a month. Now many people are leaving the Polish market. They left a public tribute and gained access to workers from Ukraine and Belarus. Now Poland has become unattractive, so they are also moving south.
Polish companies that still have financial resources are doing the same. From here they also run to Southern Europe. In just one law firm, MaWo, which offers legal services for carriers, the number of requests for company re-registration ranges from 5 to 10 per month.
"On the scale of the country, these are hundreds of companies that will soon contribute to the budgets of other countries. This must be stopped now, because then it will be too late. If someone has already transferred his business to Hungary, he will not return, because it is better there and he does not trust the Polish legislator. We remind you that transport companies move easily. It's not a business tied to a place, like a car repair shop, for example."
Mariusz Fronk
According to the Central Statistical Office, in the first quarter of 2024, 200 fewer transport companies were registered in Poland than a year earlier in the same period. According to Mariusz Fronk, in order to save the situation, it is necessary to first cancel the amendment to the law on driver's working hours. The possibility of paying business trips for international trips was removed, explaining this with the EU mobility package implemented in Poland. There is no such ban in the Mobility Package, and all of Europe, except for Poland, uses delegation. The changes entered into force in 2022. The possibility of reimbursement of travel expenses was then excluded. In many cases, travel expenses constituted a significant part of the driver's salary.
"Strange situations happen. Let's take a bus trip from Warsaw to Paris as an example. The drivers work on the entire route, the pilot starts work on the spot, in Paris. He receives money for business trips, but the drivers do not."
Mariusz Fronk
As a result, Polish drivers do not want to work for Polish employers, unless the company operates in another, more legally accessible market, for example, in Hungary or Romania.
Currently, the country lacks about 140,000. drivers For comparison, this deficit is 600,000 in the entire European Union. The transport sector accounts for about 7% of Poland's GDP and more than 6% of employment.