NORWAY NEWS ANALYSIS THE NORDIC PAGE

Foreign Drivers a Threat to Transportation, but Positive for Exporters

The difference in wages between a Norwegian driver and a driver from one of the new EU member countries can be a threat for the transport, but also provides export companies the opportunity for cheap transportation to international markets.

This shows a review of conditions in transport and logistics market by Institute of Transport Economics (TØI). The difference in wages between a Norwegian driver and a driver from one of the new EU member countries makes considerably greater cost differences than the sum of all charges for road transport. The report shows that wages and social costs represent the largest share of the performance cost of long-haul with the tractor and trailer, with 40% in total.

Followed by fuel, including taxes (24%), capital costs (depreciation and interest) with a total of 16%, while the annual fee is comparatively a very marginal cost ratio (less than 0.5%). The public framework consists of fuel tax, social security costs and weight fees, which together account for 19% of transport costs. Transport costs' share of sales varies significantly across industries, but is on average about 40% of logistics costs, or about 6% of turnover, but the industries that supply goods with low processing level, the higher transport cost share than finished goods and goods with high unit value.

Accordingly, the differences in labor costs for a Norwegian driver compared with a driver from the new EU countries are from 80 to 90%. This corresponds to a difference in the performance cost of about 40%. Cost differences illustrate why the Norwegian-registered trucks for an extended period of time have lost market share by cross-border shipments. This cost difference, according to TØI, may contribute to Norwegian exporters to have opportunities for cheap return transport out of the country, and also help to open new markets for Norwegian exporters even with small volumes.

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