TEG Road Transport Price Index Report – December 2024

Diesel prices rose by 2.05p per litre (1.46%) in December, resulting in an average pump price of 142.52p. That’s still 8.36p per litre (5.54%) lower than a year ago. 

Petrol prices also increased, with a 1.43p per litre (1.06%) increase in December. The average price was 136.23p. Again, this was lower than 12 months ago, when petrol prices were 4.35% higher at 142.43p per litre. 

While higher fuel prices are never welcome, the December rises were modest, in line with November’s increases. 
 
Importance of logistics highlighted in new National Planning Policy Framework 

Logistics UK welcomed the importance placed on logistics development in the government’s new National Planning Policy Framework (NPPF). This is the first time it has recognised the importance of logistics improvements for the economy. 

The framework states that planning policies should focus on helping develop the economy, “including by identifying suitable locations for uses such as laboratories, gigafactories, data centres, digital infrastructure, freight and logistics”. 

Jonathan Walker, Logistics UK’s head of infrastructure and planning policy, commented: “The government’s instruction to planners to support the economy by identifying suitable locations for freight and logistics is a significant step forward for our sector. For too long logistics has been an afterthought in the planning system, so today’s announcement will help our sector play a greater part in rebuilding the economy.” 

RHA MD Richard Smith also welcomed the news, although he remains concerned the government has yet to go far enough to support the industry: “Throughout the summer, we engaged with government to highlight the problems that exist within the NPPF around land for logistics usage, lorry parking, as well as the need for green infrastructure. We look forward to future opportunities to engage further to future-proof Britain’s freight industries, keep the supply-chain moving and deliver on the government’s stated objective of delivering economic growth.” 
 
Sharp fall in electric van refuelling costs 

Just as petrol and diesel prices fell across 2024’s summer months, so too did the cost of refuelling electric vehicles (EVs). This is according to research by fuel and business expense payment company Allstar. 

Using data gathered from millions of charges on the Allstar payment network, the company reported that at-home vehicle charging has dropped around 15% to 24p per kWh, while costs on the public charging network have fallen to an average of 78p per kWh. 

Looking ahead to 2025, Ashley Tate, Allstar Chargepass UK MD, said: “The transition to electric vehicles continues, and while it may have faced some headwinds this year, the industry is hard at work investing in infrastructure, with more than 59,000 charge points now on the Allstar network and ChargeUK claiming a new connector goes online every 25 minutes.” 

Acknowledging many commercial vehicles continue to run on petrol and diesel, Paul Holland, MD for UK/ANZ Fleet at Corpay, including UK brand, Allstar, is calling for greater support to help businesses decarbonise and manage their operating costs. 

“While electric will take over one day, at present many businesses still have a majority of their commercial fleet running on petrol and diesel. But that doesn’t mean they are ignoring the need to run more sustainable operations and reduce emissions. 

“They need support to drive more efficiently, buy fuel more effectively, plan better routes and streamline operations,” he said. 
 
Expert insight

“That spot rates went up in December compared with November is hardly news, they always go up at this time of year, reflecting increased seasonal consumption, but the year-on-year increase for haulage at 10% shows that inflation continues apace in parts of the economy. So, it was almost inevitable that the Bank of England, with its one KPI of 2% CPI, was going to maintain interest rates at its final meeting of 2024, however painful that may be for businesses and real growth in the early months of 2025.” 

Kirsten Tisdale – Senior Logistics and Supply Chain Consultant – Aricia Ltd  

In Summary

The transport industry welcomed additional demand in advance of the festive season. This saw the TEG index rise by 5.7 points in December, a scenario we’ve seen before at this time of year. 

The upward trend for fuel prices has continued for a second month, but the increases remain modest. Meanwhile, inflation was higher than desired and the Bank of England held interest rates to try and address this.  

While cost pressures continue, there are reasons to be optimistic as we move into 2025. Consumer confidence is slowly shifting upwards while the economy continues to be in a stable place. The government, meanwhile, has started to appreciate the importance of supporting the logistics sector to enable economic growth. So yes, let’s be optimistic as we start the new year.