Prospects for Structural Changes in the European Market for International Road Freight Transport Services

Introduction – The Situation on the European Market for Road Freight Transport Services

A rational investor or shareholder, as well as company executives, set a development strategy and focus on its implementation. The time horizon of a development strategy can vary. For companies acting as service providers in the road freight transport market, the decision-making horizon is up to 5 years. A business plan is developed for this period, taking into account the implications of entering into vehicle leasing agreements (typically for 3 years). In industrial and commercial enterprises that act as service recipients, the decision-making horizon should be significantly longer, spanning at least 10 years or more. Planning and implementing changes to the production portfolio, as well as restructuring supply and distribution chains, requires the preparation and implementation of projects that often take longer than 5 years to complete.

When analyzing the situation in the road freight transport market, two fundamental changes that have occurred in Europe over the past decades must be highlighted. First, since 1990, there has been an ongoing process of integrating the economies of Western Europe with those of countries previously associated with the Soviet bloc. A turning point was the admission of new member states from Central Europe into the European Union and the expansion of the Schengen Area to cover a significant portion of Europe. Second, investors from Western Europe decided to make numerous foreign direct investments (FDI) in Central Europe. A supply chain model was adopted that led to a sharp increase in trade between Western and Central Europe. Intra-European freight transport was predominantly shifted to road transport. Freight volumes carried by rail were reduced, mainly due to a change in the structure of goods transported within Europe. At the same time, industry and trade had to adapt to the changes in the transport system. After 1990, state-owned railways largely lost their capacity to handle freight flows, shifting their focus to passenger service. Private freight carriers took over some of the contracts from established rail carriers but failed to develop an offering that would attract new freight to the railways. Due to the drastic decline in Western Europe in the number of drivers willing to work for many days away from their homes, shippers have turned to importing services provided by carriers registered in Central Europe. Among them, carriers representing a large group of micro and small enterprises, as well as a small group of entities classified as medium-sized enterprises, have gained a dominant position.

Between 1990 and 2003, many thousands of private companies were established in Central Europe -primarily in Poland- that began operating as trucking firms. Numerous unemployed men, who had acquired professional qualifications during their mandatory military service, entered the trucking profession. For them, work involving spending many weeks in a truck cab was comparable to the living conditions they had experienced in the barracks. Between 2004 and 2022, the trend of growth in road transport capacity continued. However, data from 2023–2026 illustrating the activity of road carriers indicate that this trend came to an end in 2023. Over the past three years, a decline in the size of carriers’ vehicle and workforce capacity has been observed in Central Europe. The rate of decline through 2026 is not significant. Forecasts indicate that this rate will increase significantly in the coming years. For demographic reasons, the disparity between the number of people willing to start or continue operating a road transport business and the number of people who will step down from their roles as business owners managing transport companies, whether micro, small, or even medium-sized private enterprises, will grow year by year. Alongside the driver shortage, a phenomenon driven by demographic changes and already observed for years in the labor market, the shortage of business owners will become increasingly apparent. Road transport is therefore facing a crisis of social capital shortage. This crisis will not be alleviated, even if the European labor market were to open up. This is because there is no political will among Europe’s leading political forces to significantly increase the capacity of road transport through immigration from outside the continent—whether of drivers or business owners.

Overfishing and the Failure to Regenerate the Fleet’s Capacity

There are fewer and fewer fish available in the Baltic Sea. Since the 1990s, successive fishing restrictions have been introduced. In Poland in 1990, 15,000 people were employed to operate approximately 1,400 fishing vessels. By 2025, the number of employees had fallen to 2,800, and fewer than 750 fishing vessels are registered[1] . Overfishing reveals that fish populations have lost their ability to reproduce. The occurrence of this phenomenon in the Baltic Sea could have been predicted many years in advance. But warnings from conservationists and scientists were downplayed. Instead of taking immediate action, measures were implemented belatedly - measures that were merely a desperate reaction by public authorities and the business sector to the lack of fish in this body of water.

The description of the long-standing decline in fish stocks in the Baltic Sea points to a similar situation that is very likely to occur in the European road transport services market. As a result of demographic changes and economic policy mistakes, both in Western Europe and in Central Europe, the number of entrepreneurs willing and able to operate businesses providing services in the international road transport segment, which requires drivers to be away from their permanent residence for more than five working days, will decline.

Road carriers registered in Poland account for approximately 30% of the transport volume carried out in the context of intra-Community trade. This activity encompasses two subsegments of international freight transport. The first concerns transport in bilateral relations (between the exporting and importing countries) and is referred to in industry literature as the “first mile.” The second subsegment consists of transport between third countries (so-called “cross trade”) and is referred to as the “middle mile.” Polish carriers employ drivers, some of whom- with 30 or more years of experience -have for decades accepted working in very difficult living conditions (sleeping in their cabs, limited access to restrooms and rest areas) and spending many days, or even weeks, away from home. There are fewer drivers with shorter tenure; these are predominantly immigrants from Ukraine and Belarus. There is no fully viable substitute for the services exported by carriers registered in Poland. Transport services provided within Western Europe on cross-trade routes cannot be imported in any way by using carriers registered outside the EU. Within the EU, no country - including neither Lithuania nor Romania - can provide an increase in carrier capacity on the scale that will result from the withdrawal of a significant portion of Poland-registered carriers from the European market. Europe therefore faces the risk of a growing shortage of transport services in the “first mile” and “middle mile” subsegments. The shortage will be particularly acute in the “middle mile.”

Strategy—what will matter in 5 and 10 years, or even several decades from now?

The perspective of a carrier from the micro and small business sector

Entrepreneurs in the micro and small business sectors behave in a distinctive way. Owners of companies of this size - which were established in Poland and other Central European countries in recent decades - possess different competencies than investors, as well as members of the management boards of medium-sized and large enterprises, who draw on management and financial know-how accumulated over more than a century in Western European companies. Over the past three decades, business strategies in micro and small enterprises in Central Europe have taken shape spontaneously, and the source of their success has been a strong motivation to work hard. At the root of this motivation was a strong desire to participate in the political transformation taking place in post-socialist countries. The goal of the business ventures undertaken was to replace one’s individual position as a worker performing inefficient labor for a state-owned employer with the position of a beneficiary of the emerging new socio-economic system. Entrepreneurs took on the role of selling the services of an international trucking company to generate profit and dramatically improve their families’ living conditions. Thirty-five years ago, no one thought about identifying and strictly complying with applicable regulations. Entrepreneurs disregarded compliance obligations, and the administration in place at the time - including the police and customs services - was unable to monitor the activities of the tens of thousands of small businesses that had sprung up. Established in the 1990s (and later) in Central Europe, this group of entrepreneurs shows a tendency in the third decade of the 21st century to continue their business activities using the same methods they mastered in past decades. This group has failed to expand its own competencies, which are essential for achieving capital and organizational consolidation.

For biological reasons, the generation of pioneers in private road transport is winding down; this period began after 2020 and will end before 2030. On the service provider side, the successors of the pioneer generation (children or grandchildren) and those who enter this business from the ground up will remain. All owners of micro, small, and medium-sized enterprises must ask themselves whether operating as an international road carrier under the conditions prevailing in the third decade of the 21st century is a lifelong pursuit - or perhaps even one for future successors within their own family business. If the answer is not unequivocally positive, the question immediately arises as to whether it might be worth engaging in business activities in an industry other than road transport. The assessment of the attractiveness of operating as a service provider will determine whether the new generation of entrepreneurs will choose international road transport as the field of business activity for their family business. Due to the inaction of public authorities at the EU and national levels, young entrepreneurs are not receiving any signals that the strategic importance of the international transport sector for the entire European economy is being recognized.

The Perspective of Shippers from the Group of Medium and Large Enterprises

On the shippers’ side (i.e., in industry and commerce), which have so far relied on international freight transport provided mainly by family-owned companies registered in EU member states, three new solutions may be explored:

• neither on the supply side nor on the sales side will services provided by international road carriers be needed, as the delivery and return route will be reduced to a distance of no more than 300 km, which is referred to in industry literature as the “last mile,”

• transportation needs involving the movement of goods over distances of more than 300 km (first mile and middle mile) will be met using services other than road transport—potential substitutes include services provided by rail freight carriers, intermodal transport operators, and short-sea shipping companies,

• transportation needs will be met using services provided by next-generation road transport operators, who will operate autonomous (driverless) vehicles as part of a large-scale network.

  
  

In the coming decades, the role of rail carriers, as well as that of intermodal transport operators, will remain limited. Market research indicates that, in the most optimistic scenario, rail and intermodal transport will account for no more than 15% of the total freight volume handled by the European land transport system. A realistic scenario takes into account that, despite declarations by public authorities at the EU and national levels regarding support for rail, this mode of transport will remain operationally inefficient, and transport services on pan-European routes will fail to achieve the expected economic efficiency. The condition of the rail infrastructure is poor (with a few exceptions) and is improving only slowly. On the existing network, passenger train traffic is and will always be given priority. This means that neither the volume nor the quality of rail freight transport will improve significantly. Access to coastal shipping services, on the other hand, is geographically limited, which prevents many shippers from choosing this mode of transport as their primary solution for meeting their logistics needs.

Although the first freight transport operations using autonomous trucks have already been launched in the U.S., it remains unclear under what conditions the operation of this fleet will ensure the expected efficiency of transport processes. There are no economic analysis results yet for such operations in the U.S., where certain corridors - primarily in the Southern states - offer particularly favorable conditions for operating heavy-duty road vehicles. It is impossible to predict whether autonomous trucks will be deployed on public roads in Europe within the next 10 years or two decades. There is therefore no basis for forecasting what price levels for services might be offered by next-generation road transport operators seeking to achieve satisfactory economic results. We should therefore exercise caution in proposing that the introduction of autonomous (driverless) trucks in Europe will be the solution anticipated by industry and commerce when commissioning road transport for first-mile and middle-mile routes.

Every shipper in Europe should define a long-term development strategy that incorporates the use of one of the three logistics solutions mentioned above. If they do not choose any of these and need long-distance transport services (first mile and middle mile), they must determine how they intend to secure access to the services of international road carriers. The choice is limited to two options:

• since “price works wonders,” it is possible to calculate the increase in the cost of purchasing services provided by road carriers; by being prepared to pay ever-higher freight rates, the shipper will always be able to secure a service provider, even amid a worsening shortage of transport capacity (both in terms of personnel and equipment),

• to create new business models that will allow for maintaining control over both free access to the services of carriers providing first-mile and middle-mile services and maintaining budgetary discipline when purchasing these services.

The first of the options mentioned assumes a continuation of “business as usual.” Restricted access to carrier services could lead to a decline in the efficiency and effectiveness of logistics processes and, consequently, to a loss of competitiveness for industrial and commercial enterprises. This is not a strategy that will ensure the development of trans-European business in industry and commerce. In Europe, large industrial and commercial enterprises are already recognizing that the time has come to seek new solutions to meet their logistical needs.

In the second of these scenarios, it is necessary to find an answer to the question of how to encourage private entrepreneurs to continue (through successors) or start (through new entrants) operations as an international road carrier , bearing in mind that these entrepreneurs must overcome many challenges, including those resulting from:

• increasing regulation covering all economic activities and heightened compliance obligations for entrepreneurs,

• demographic changes in the European labor market and shifts in employee attitudes (namely, projected declines in the number of men and, within this group, the proportion of employees willing to work as drivers who travel away from home for many days at a time),

• the digital transformation, whose expected effects in the B2B sector can be achieved if trust between business partners is successfully built and then nurtured; the existence of trust is the foundation for mutual data exchange, yet it is a rare phenomenon, as the private carrier community is hostile toward its clients,

• the energy transition, the course of which in Europe is unpredictable both in terms of the direction of change and the pace of those changes.

This new—and much-sought-after—business model poses a challenge for decision-makers and their stakeholders. On the one hand, shippers will find it difficult to abandon a scenario in which international freight services are an essential element of supply chains. On the other hand, private carriers may opt for a scenario in which operating conditions for companies providing first-mile and middle-mile services are expected to improve. Business risk in the international road transport industry can be assessed as comparable to, or even lower than, the risk present in alternative areas of economic activity.

The expectation that operating conditions for international road carriers will improve significantly is based on the growing risk of “overfishing” in the market for these services. A reduction in carriers’ capacity is inevitable. The horizon for business decisions is determined by factors that shape the structure of the entire economy in the long term. In just 5 years, the effects of “overfishing” will be clearly visible, and in 10 years they will be even more apparent. The risk of a shortage of international road transport services will materialize over the coming decades, which shippers will feel more and more acutely. The primary challenge will be the simultaneous decline in the number of operators and drivers who remain active in this market segment.

A New Business Model for International Road Freight Transport

Both the demand and supply sides of the international road freight market are highly fragmented. On a European scale, the number of entities on each side of the market exceeds at least one hundred thousand. The process of organizational and capital concentration has been stalled for decades. On the supply side of the market, there are no entities operating as joint-stock companies that are listed on stock exchanges. International corporations with substantial capital resources and the necessary know-how have refrained from entering the “first mile” and “middle mile” market segments. By providing logistics and freight forwarding services, they constitute an important group of supply chain creators who consciously limit themselves to acting as intermediaries between shippers and road carriers. In both Western and Central Europe, the prevailing view is that the task of managing drivers and truck fleets should be left to the owners and managers of micro, small, and, in a few cases, medium-sized enterprises.

The digital transformation has created the conditions to centralize the management of operational processes in first-mile and middle-mile road transport, just as is already common in the last-mile segment. However, the experiences of U.S. companies that sought to create a digital freight forwarder to optimize transportation processes confirm that standardizing first-mile and middle-mile operations - which involve many elements with an unstable structure - faces significant barriers. Similar experiences have also been observed in Europe. It turns out that freight forwarders and drivers are individuals characterized by tremendous flexibility in decision-making under conditions of very limited access to information. A person who has undergone a brief training program but has earned qualifications and gained experience demonstrates a very high ability to immediately adapt to changes in the planned sequence and schedule of operational activities. These are individuals performing important professional tasks that are difficult to automate, as the nature of these tasks defies standardization. Although increasingly advanced artificial intelligence solutions are available, they have not yet succeeded in taking over many of the tasks performed by employees in first-mile and middle-mile road transport, even though many tasks in the last-mile segment have already been automated.

A new business model for first-mile and middle-mile services ensures that the road carrier’s operations retain their hybrid nature, in which the private entrepreneur and the drivers they employ continue to play a fundamental role. If micro, small, and medium-sized enterprises are to continue to dominate the supply side of the international road transport market, their owners must be helped to achieve two economic outcomes. First, the new business model requires the introduction of a mechanism that rewards all participants in the supply chain for streamlining their operations. It is desirable to utilize digital technologies that enable the geolocation of the fleet and the efficient identification of optimal decisions regarding the location and timing of drivers’ and vehicles’ operations. It is essential to eliminate situations where drivers must wait to begin driving with a load or to complete a transport assignment. At the loading site, en route—including at border crossings within the Schengen Area and at the Schengen Area’s external border—as well as at the vehicle’s unloading site, the driver’s downtime should be reduced to a minimum. In the vicinity of logistics centers, the existing road network requires adjustments to eliminate the phenomenon of vehicles waiting in traffic jams on the section connecting highways to the loading and unloading sites for the fleet. The modernization of local roads is also essential to accommodate rolling stock classified under the European Modular System (EMS), the operation of which will contribute to increasing the productivity of drivers’ work, as well as improving energy efficiency and reducing emissions from road transport. Social conditions at every rest stop should guarantee the expected level of comfort for both nighttime and daytime rest. Drivers’ working time should be utilized at nearly 100%. Improving the driver working time utilization rate by each percentage point will result in a correspondingly significant reduction in the demand for drivers in international road transport who work for many days away from their place of residence. Second, business owners should be offered access to a fleet without the risk of having to cover maintenance costs (including lease payments) for vehicles taken out of service during periods of lower demand. Such conditions can be created by commercial organizations that offer flexible rental periods for the fleet instead of lease agreements. Shifting capital risk from micro, small, and medium-sized enterprises to large corporations will increase the incentive to manage their own entities, whose primary task is to provide first-mile and middle-mile transportation services using available rolling stock and their own fleet of drivers.

The proposal to transfer the risk associated with utilizing the potential of physical resources - i.e., the truck fleet -from carriers can be implemented through local or European agreements between vehicle manufacturers and financial institutions. An additional long-term effect of such agreements could be the involvement of all stakeholders in the European logistics system in carrying out the energy transition in first-mile and middle-mile road transport. Together, projects can be implemented to create new ecosystems that encompass not only the fleet but also a network of infrastructure points designed for refueling with new types of liquid and gaseous fuels or for charging batteries with electricity. Energy sources can be obtained from a network of biogas plants covered by such an ecosystem, as well as from a network of renewable energy generation and storage facilities. In these new ecosystems, it is desirable to foster openness to new technological solutions. It is premature to decide in 2026 that an ecosystem supporting N2- and N3-class fleets with the characteristics of battery-powered electric vehicles will be preferred. The advantages and disadvantages of this solution in relation to N1-class fleets operating in the last-mile segment have not yet been sufficiently identified.

The proposed new business model would be characterized by two significantly different approaches to formulating business development strategies. In micro, small, and medium-sized enterprises that provide first-mile and middle-mile transport services, strategic decision-making would be dominated by a time horizon limited to 2–3 years. In the event of a decline in demand for services, operators could flexibly reduce their workforce and material resources (including a leased fleet of trucks). The introduction of new energy sources and new propulsion systems would not be subject to the carrier’s decision, which would significantly reduce the risk factored into its business plans. The provision of a fleet with a changing structure in terms of propulsion systems and energy source utilization would depend on strategic decisions made jointly by entities classified as large enterprises—namely, shippers, rolling stock manufacturers, and the financial institutions collaborating with them. These decisions would be continuously adapted to changing regulations, which are frequently introduced by public authorities, primarily at the EU level. Strategies for implementing the energy transition require a time horizon of at least 10 years. Adopting such a long-term horizon is associated with the protracted nature of preparing and implementing the infrastructure projects that are essential for carrying out the energy transition in “first mile” and “middle mile” road transport.

The digital transformation will facilitate the creation and widespread adoption of a new business model in international road transport. Improvements in data collection and processing will ensure a higher level of transparency in operational processes and more accurate monitoring of economic outcomes. Increasing digital maturity among all supply chain participants and entities that support the exchange of goods will help owners of micro, small, and medium-sized enterprises implement appropriate IT applications across all job roles, including among drivers. In this business model, equal rights and obligations for all supply chain participants must be ensured. Only by guaranteeing this can the trust necessary for the exchange of a full set of data between business partners be built. Mutual trust is also essential so that all market participants have equal conditions for meeting compliance requirements.

Summary

Structural changes in the European market for international road freight transport are to be expected. After considering the possible scenarios for these changes, decision-makers representing the business community and public authorities can define a development strategy for the transport industry, which comprises tens of thousands of micro, small, and medium-sized enterprises. The workforce consists of drivers (almost exclusively men) who possess the necessary qualifications and are prepared to work away from home for many days at a time. Europe is experiencing a decline in the number of transport operators and drivers, and this trend must be reversed, given that road freight transport has no fully viable substitute and cannot be imported from outside the EU. Whether European road transport will suffer from “overfishing” - as has happened in the Baltic Sea - depends on the appropriateness of the development strategy chosen for this industry. The challenge is to avoid a shortage of road transport capacity. First and foremost, this challenge must be addressed by decision-makers representing large industrial and commercial enterprises, as well as logistics operators. Additionally, public authorities - at both the EU and national levels - must rise to this challenge. It is necessary to adjust public policies in various areas to halt the trend - observed not only in Western Europe but also in Central Europe - of a reduction in the capacity of road carriers providing first-mile and middle-mile transport services. If this challenge is not met, the shortage of road transport capacity in Europe will become a significant barrier to economic growth. In a worst-case scenario, this shortage could lead to a decline in the volume of goods traded within the EU market. Consequently, this would result in a decrease in consumption levels among European residents. In Poland, where the value of road transport services exports is the highest (both in relative and absolute terms), a reduction in the activity of carriers providing “first mile” and “middle mile” transport services will create a gap in the foreign trade balance for goods and services. Consequently, the balance of foreign exchange transactions conducted in Poland will be weakened.

[1] The Baltic Sea in Crisis—What About the Fish? https://topflop.pl/rybolowstwo-baltyk-2026-limity-gatunki-problemy/ (June 1, 2026).