KPMG overview of the transport sector in Russia | KPMG | RU
close
Share with your friends

KPMG overview of the current state of the transport sector in Russia and globally

KPMG overview of the transport sector in Russia

KPMG professionals have analysed the key factors driving the development of various transport market segments and identified the most pressing challenges currently facing Russian transportation companies.

1000

Related content

KPMG professionals have analysed the key factors driving the development of various transport market segments and identified the most pressing challenges currently facing Russian transportation companies.

Confidence in the transport sector depends on global trade growth, and whenever this slows there is a significant negative impact on the industry: decreased demand for freight shipments and cost escalation affect the majority of companies operating in the areas of maritime shipment and transport infrastructure. It might appear that a fall in oil prices helps transportation companies trim their expenses, and serve as a source of support in challenging times; however, in practice these companies experience upward price pressure from customers, who expect that a drop in fuel prices should result in a fall in transportation charges. Moreover, cheap fuel is one of the reasons for the retention of inefficient capacities and technologies, as well as for losses on hedging instruments. The situation in the transport sector is a key factor which dictates the competitiveness of the domestic Russian economy. Hence exchange rate fluctuations and a deterioration in main macroeconomic indicators in 2014-2015 do not add to the investment attractiveness of the country from a local transport industry aspect. Economic instability impacted on all transportation segments, with freight companies in particular suffering badly.

In such a situation, negative trends may be overcome by resolving various strategic issues that have inhibited sector development for a number of years: insufficiently developed port infrastructure, a lack of railway lines at the same time as there is excess rolling stock, and the poor condition of roads. In view of the fact that state funding has been cut, such projects will require significant private investment and, in addition, over the next few years we will see a fall in the number of government-sponsored megaprojects.

The full version of the survey is available here (only in Russian).  

Connect with us