The overall TEG Price Index fell 2.3 points to 127.2, following a brief period of stability in late summer. The Haulage Index dropped by 2.48%, while the Courier Index saw a smaller decrease of 1.15%. Compared with October 2024, both indices were only slightly higher, indicating a market that has largely plateaued after months of subdued activity.
Vehicle availability continued to climb in October, rising 18.9% overall and 21.7% for artics, marking the second consecutive month of high capacity. In contrast, demand fell by 5.4% overall and by 17.1% for artics, mirroring trends seen in the same period last year.
This widening gap between availability and demand highlights the persistent overcapacity in the UK transport market. With more vehicles chasing fewer loads, competition among hauliers is intensifying, putting additional pressure on rates during what is traditionally a busy quarter.
Labour market remains tight
Despite weaker demand, driver pay continued to rise. The average HGV driver salary increased by 1.2% in October to £42,968, with vacancies reaching their highest level of the year at 5,639. According to TEG, this may reflect agency drivers returning to work after taking summer breaks rather than a sustained increase in demand.
Consumer spending delays impact freight flows
TEG suggests that consumer behaviour may also be contributing to the October slowdown. While the GfK Consumer Confidence Index rose two points, indicating improving sentiment, many consumers may be holding back purchases ahead of Black Friday and the Christmas season.
The report notes that unusually warm summer months likely shifted spending earlier in the year, while November’s sales events have become a key driver of seasonal demand. As a result, October restraint could increasingly become a regular feature of the transport calendar.
Policy uncertainty ahead of the autumn budget
The transport sector is now watching the UK government’s 26 November autumn budget, when Chancellor Rachel Reeves is expected to outline plans to address an estimated £22 billion fiscal shortfall. Industry groups fear a possible reversal of the 5p-per-litre fuel duty cut, or even the introduction of a pay-per-mile road tax scheme.
Consultancy RSM UK notes, however, that fuel duty receipts have been falling due to the ongoing transition to electric vehicles. The Office for Budget Responsibility estimates that fuel duty will account for just 2% of total tax revenue in 2025/26, compared to 7% in 2019/20, suggesting it may no longer be a major lever for government revenue.
The Bank of England is also expected to debate whether to lower interest rates from 4% to 3.75% on 6 November. A rate cut could boost consumer spending power — particularly among the 20% of mortgage holders with variable-rate loans — but any tax increases announced later this month may offset those gains.
Fuel prices edge up
Fuel costs continued to rise modestly in October. Average diesel prices reached 142.99p per litre, up 1.15p (0.81%), while petrol rose to 134.67p per litre, up 0.69p (0.52%). Both fuels remain around 3–4p higher than a year ago.
The Road Haulage Association (RHA) has warned that ending the 5p fuel duty freeze could increase household living costs by £7.3 billion by 2029 and risk slowing economic recovery.
“Goldman Sachs expects a cut in interest rates this Thursday when the Bank of England meets, even though the CPI is well above its target. This is not true of inflation in road transport, where the most recent ONS figures for Q3 were 2.1% for road freight and 0.8% for courier work. And the most timely figures, from the TEG Road Transport Price Index for October, are even lower at 0.3% and 0.6% for Haulage and Courier respectively. With the recent impact of JLR and the budget ahead of us, one or both of the BoE and government needs to give the economy a gee-up!” said Kirsten Tisdale, Senior Logistics and Supply Chain Consultant, Aricia Ltd
