The South African logistics sector has just completed its strongest ever quarter of growth, according to the Ctrack Freight Transport Index.
“As often happens, the biggest decline is followed by the highest growth,” said fleet management company Ctrack SA’s managing director, Hein Jordt.
“With September being the end of the third quarter, Statistics SA is expected to release the updated GDP figures imminently and all indications are that they will show the strongest growth per quarter in our lifetime,” said Jordt.
In June the logistics sector recorded a decline of 17.6% compared to the previous quarter while the growth over the second quarter improved with a figure of 11.8%. According to the index only two subsectors recorded a decline – pipelines, which is the smallest subsector, and storage, which is historically very difficult to predict.
The index had been recording these trends for a considerable period of time and this level of growth and recovery was unprecedented, he added.
“Freight transport tracks the economy in near real time, and this tell us that the third quarter GDP will be the highest on record too. The Ctrack index has a very close relationship with GDP and this is why we now expect the strongest GDP on record for South Africa and many other countries too.
“However, while this recovery may seem remarkable, one must remember that if your turnover is cut by 50% from R1000 to R500 in one year and you get a 50% increase on the R500 turnover the next (year two), your turnover is now only R750, which is still 25% less than in year one.”
If South Africa experiences a second wave of Covid, it will have some negative impact but won’t be as devastating as the first wave, in his view.
Looking at the results on a sector by sector basis, airfreight experienced the strongest quarterly recovery. The 22.5% improvement quarter on quarter is significant but still leaves this sector down 33.9% compared to the same quarter last year. Read more here
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Original Article on record growth: https://www.freightnews.co.za/article/logistics-sector-posts-record-growth-q3