September 2023 | BUSINESS FLEET AFRICA
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the areas of electricity as well as crime
and corruption. It is indeed a welcome
development that could lift the economy
out of ‘muddle-along’ mode and ignite
an economic recovery phase.
“It is great that government is
finally moving forward with Operation
Vulindlela. I do hope that it ignites the
recovery the broader transport industry
and the South African economy so
desperately needs,” says Hein Jordt,
Chief Executive Officer of Ctrack.
Fragmented growth has character-
ised the Ctrack Transport and Freight
Index sub-sectors over the past few
months, derailing any hope of a syn-
chronised recovery. Only three of the six
sub-sectors of the Ctrack Transport and
Freight Index increased on a quarterly
basis in July 2023, with Road, Rail and
Air Freight the laggards. On an annual
basis, four of the six sub-sectors still
declined, despite the overall index level
increasing by 3,3% compared to a year
earlier. Among the sub-sectors, Road
transportation (the biggest sub-sector)
has always been most resilient. Still,
annual growth has subsided notably to
only 6,9% year on year during July 2023,
a far cry from annual growth of 28,2%
experienced in August 2022 and the first
single-digit annual growth rate recorded
since March 2021.
The Sea Freight component, one
of the sub-sectors hardest hit by the
Transnet strike in October 2022, con-
tinued its gradual recovery during July.
While only container handling increased
during July (as other cargo handling
declined), the Sea Freight subsector
increased by 4,6% on a monthly basis
but remained in negative territory
compared to levels of a year ago (-3,1%
year on year). Following the ongoing
underperformance of South African
ports, the announcement by Transnet
National Port Authority of the first
privatisation of a South African container
terminal has created strong positive
sentiment in an industry crying out for
better port performance. International
Container Terminal Services (ICTSI) was
awarded the 25-year concession last
month, and the biggest anticipated
impact over the concession period is
the expected improvements in terminal
productivity. ICTSI will operate the
terminal, rolling out best practices learnt
from its extensive experience gained
from operating 34 terminals globally.
The Pier 2 container terminal handles
72% of the Port of Durban’s throughput
and 46% of South Africa’s port traffic,
thus, a notable improvement could be
a game changer for the industry and
the economy at large. The underperfor-
mance of Sea Freight relative to the total
transport and logistics sector, especially
over the past two years, has been clearly
evident.
The Road Freight sector has ex-
perienced multiple headwinds in the
past few months, including an IT glitch
that caused border crossing delays to
renewed unrest and the burning of
trucks on the N3 in KwaZulu-Natal, which
subsequently spread to Mpumalanga
and Limpopo early in July. These events
had a visible negative impact on the
number of heavy vehicles on the road,
especially during the first weeks of July.
While heavy vehicle traffic bounced
back on the N4 route, growing by
double-digits on a monthly basis and
reversing the slump in June, truck traffic
125
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Pre-Transnet
strike level
Graph 3 Ctrack Transport & Freight Index vs Sea Freight Index (2016=100)
CTRACK
It is great that government is finally moving forward
with Operation Vulindlela. I do hope that it ignites
the recovery the broader transport industry and
the South African economy so desperately needs