- Almost one fifth of respondents from the global transport sector fear a skills shortage but just 6% are prioritising investment in their workforce
- Optimism is growing among the global aviation, rail and shipping sectors and new opportunities are emerging
- China is the most popular market for investment
- The purchase of additional assets is also favoured as an investment strategy
According to global legal practice Norton Rose Fulbright’s fifth “The Way Ahead” Transport survey, 17% of respondents from the global transport sector believe a lack of suitably qualified people is the greatest challenge to the future efficiency of their business. Despite this, just 6% of respondents from the aviation, rail and shipping sectors believe investment in the skills and size of their workforce would be the most beneficial investment for their business or sector.
The ability to recruit suitably skilled employees is a particular source of anxiety for respondents based in the Middle East, with 28% of the view that this will be the greatest challenge to the future efficiency of their business, followed by 21% of respondents based in Asia Pacific and 21% in North America.
The survey, entitled Where Next? reveals confidence is growing among the transport sector in line with improving economic sentiment. Three-quarters (75%) of respondents believe current conditions are positive for their business and 47% see new opportunities emerging.
Four out of five (82%) respondents believe passenger numbers and freight volumes will rise and 66% expect fares and freights to increase. Forty percent anticipate that a greater proportion of their funding will be allocated to investment as opposed to operating costs.
China is the most popular market for investment in the next two to five years, according to 30% of respondents, followed by Western Europe (27%) and North America (22%).
Investment in additional assets and in developing new markets are considered the most worthwhile investment opportunities for the aviation and shipping sectors, while rail views investment in infrastructure as most advantageous for their business. Investment in additional assets is particularly popular among respondents in the Middle East (32%) and in North America and Africa (22% respectively) and by 21% of respondents globally. Almost a third (30%) of respondents based in Africa also favour investment in developing new markets, followed by 22% of respondents based in Europe and 21% based in the Asia Pacific region.
However, finance will be required to fund investment and a more beneficial view of asset values for risk weighting purposes is the most popular way of making funding more readily available for the transport sector, cited by 26% of all respondents.
Further consolidation is expected across the transport sector. A quarter (25%) of all respondents anticipate the most significant changes to the participants in their sector will be the increased dominance of the larger players and 23% expect increased joint venture, alliance and pooling activity. Twenty-two percent of shipping respondents believe also that new sources of funding for shipping will bring new participants into their sector.
Harry Theochari, global head of transport, Norton Rose Fulbright; commented:
“The aviation, rail and shipping sectors are all putting in place plans to expand their business in line with an anticipated rise in passenger numbers and freight volumes. China is seen as a key market for the aviation and shipping sectors in particular. The development of new markets and investment in additional assets are likely to be key strategies for the transport sector as it looks for growth opportunities.”
“While the majority of respondents believe funding will need to be more readily available if they are to grow their businesses, the risk of a skills shortage developing in the transport sector has also been highlighted. Ensuring a skilled workforce is in place will be fundamental to the future growth of the transport sector.”