Forklift truck market softens in wake of Brexit vote

Orders for counterbalance trucks fell 16.4 per cent year-on-year in in the third quarter of 2016, having already decreased by 5.9 per cent in the second quarter, according to the latest Forklift Truck Market Outlook for 2016, produced by Oxford Economics on behalf of the British Industrial Truck Association.

There has also been a decline in the warehouse segment, but this has not been as drastic as the decline in the counterbalance sector. Class 2 bookings fell 3.1 per cent on an annual basis, having decreased by 5.8 per cent in Q2. Class 3 managed to grow by 8.4 per cent in Q3, but this was something of a recovery given a 17.7 per cent fall in the second quarter.

The report said confidence had softened in line with the slowing prospects for the UK economy. But, despite pessimism regarding general prospects, current order books are not yet suffering as a result, with the majority of those polled considering their ledgers to be significantly better than normal, a substantial change from earlier in the year when less than a fifth reckoned this to be the case.

The Oxford Economics forecast for growth anticipates consumption staying strong in the short term (+2.8 per cent in 2016) before slowing to 1.2 per cent in 2017 and 0.5 per cent in 2018. GDP growth is predicted to be 2.1 per cent this year before slowing to 1.4 per cent in 2017.

BITA secretary-general James Clark said: “The previous Forklift Truck Market Outlook and members’ survey portrayed an industry that was upbeat despite the shock of the referendum result and remained optimistic about future prospects. Despite the lack of real clarification from Westminster – not to mention the High Court ruling requiring MP approval to trigger Article 50 – about what form Brexit might take, the sector has become more subdued in its perspective as a result of more modest data filtering through.

“That said, it’s not all doom and gloom and there are still plenty of reasons to be cheerful – not least encouraging current order books and the continuing evolution of online shopping which should guarantee a proportion of warehouse truck orders for the foreseeable future. There are undoubtedly challenges ahead, but the materials handling industry is well equipped to adapt and innovate to overcome these obstacles.”

And Jeremy Leonard, head of industry services for Oxford Economics, said: “The migration towards online shopping should continue, even if this occurs to a smaller extent due to the increased price of importing to the UK following the sharp depreciation of the pound. Online shopping requires delivery and warehousing of goods, which should continue to drive demand for warehouse trucks.”