High diesel prices push Dutch transport firms into financial strain

Transport, construction, and agricultural companies in Nederland are warning of severe financial pressure as diesel prices remain high, driving up operating expenses by hundreds of thousands of euros per month, NU.nl reported.

Industry representatives in the transport and logistics sector, where diesel consumption is highest due to long-distance truck and van traffic, report a sharp increase in costs across the board. Transport en Logistiek Nederland (TLN) estimates that transport expenses account for 20 to 25 percent of total sector costs. A spokesperson said, "Wages have also increased. The total combination is putting companies further under pressure now that diesel prices are so high.”

Erik Slaaf, sector economist for transport and logistics at ING, said the impact of diesel inflation is immediate and severe in company accounts. “A rise of 20 to 25 percent already translates into roughly 5 percent higher total costs for transport operators,” he told NU.nl. “In a sector where margins are only 1 to 2 percent, that means that trips in the interim period become loss-making.”

At Vos Transport Group in Deventer, which operates about 150 trucks daily across Europe, director Jules Menheere said the company is struggling to pass rising costs on to clients. “We try to pass on the extra costs from the high diesel price to our customers,” he told the newspaper. “And that leads to difficult discussions.”

Menheere said the company is currently facing additional costs of 800,000 to 900,000 euros per month. “The cabinet should have intervened much earlier and taken measures. Moreover, diesel in the Netherlands is already taxed much more heavily than in other countries.”

In the construction sector, diesel remains essential for heavy machinery, including excavators, bulldozers, shovels, and generators. Bouwend Nederland said it is receiving many questions from construction companies about rising fuel and transport costs, as well as increasing material costs, such as roofing bitumen. Reportedly, companies are inquiring about ways to contractually mitigate these risks. LTO Nederland, representing farmers and horticultural entrepreneurs, said it is still considering its response.

The diesel price has risen more sharply than petrol since the war in the Middle East began due to limited production sites in Europe and continued dependence on supply from Gulf states. Although a two-week ceasefire between Iran and the United States has led to a slight decline in recommended diesel pump prices, levels remain high.

Business organizations VNO-NCW and MKB-Nederland are calling on the government to act quickly to prevent financial issues. “Especially small and medium-sized enterprises are already facing liquidity problems because they cannot pass on rising costs,” they said. “A temporary public fund should be created from which viable companies can borrow money to get through this period. If escalation in the Middle East continues, the entire economy could be affected.”