What's next for the transport industry? Is 2024 the end of the industry crisis?

2023 was a year of crisis for the transport industry. The economic cooling has caused companies to make losses ❗a number of companies have had to resort to restructuring proceedings to stay afloat

2024 shows many changes both legal and financial for the transport industry. How will they cope. With these changes, small companies, of which there are many in the industry

Rok 2023 proved to be a difficult year for many transport companies, a year "under the barrel" and, for many, even bankruptcy. According to the Central Economic Information Centre, 208 companies went bankrupt in the first half of 2023, including seven from the road freight transport industry - the same number as in the whole of 2022.

Statistics show, That the scale of bankruptcy and restructuring in 2023 was enormous.

Is 2024 the end of this trend? In our opinion, unfortunately not. The transport industry is still trapped and waiting for help. Restructuring proceedings are the answer to entrepreneurs' expectations, but not always and not for everyone.

In order to achieve the desired effect, restructuring must be properly prepared. The development of an action architecture is the beginning of the road for us - the road to success.

The troubles in the transport industry are due to various factors:

1. Increase in fuel costs: Fluctuations in fuel prices significantly affect the operating costs of transport companies.
   
2. Environmental pollution: Increasing environmental requirements lead to the need to invest in greener technologies, which generates additional costs.
   
3. Infrastructure: The condition of infrastructure, including roads and bridges, affects the efficiency and operating costs of transport
   
4. Technological changes: The introduction of new technologies, such as autonomous or electric vehicles, requires significant investment and adaptation.
   
5. Regulation: Strict regulations on safety, driver working hours or emission standards can impose additional burdens on the industry.
   
6. Competition: High competition in the transport industry leads to lower prices for services, making it difficult to maintain profitability.
   
7. Safety issues: Road accidents and vehicle safety issues generate insurance costs.
   
8. Economic cycles: Changes in the economy, such as recessions, affect the demand for transport services.

The variety of these factors puts the transport industry in a difficult position and the need to respond flexibly to changing conditions is a challenge for many companies.

Some transport companies, due to low profitability, loss of liquidity, financial problems, did not make it. In a bid to protect themselves from bankruptcy, many companies have taken advantage of a simplified restructuring, i.e. an arrangement approval procedure. This has resulted in arrangement proposals that are satisfactory to the parties.

Simplified restructuring, a process that involves making changes to a company's organisation in order to improve its financial health, is helpful for transport companies in particular when we expect:

1. Protection from creditors: Simplified restructuring allows for protection from aggressive creditors, enabling the transport company to negotiate to develop arrangement proposals with a view to concluding an agreement. The process seeks to sort out the company's debts and return it to normal market competition.
   
2. Restoration of liquidity: Through restructuring, changes can be made to increase the company's liquidity, which will improve the ability to settle liabilities.
   
3. Negotiation of repayment terms: As part of the simplified restructuring, the company will work out, through a restructuring advisor, arrangement proposals that will be beneficial to the company and satisfactory to creditors. The new terms for repayment of liabilities will allow a return to normality and protect the mutual business relationship.
   
4. Adjusting the cost structure: Restructuring allows for a review and adjustment of the cost structure, which will affect efficiency in resource management.
   
5. Maintaining current operations: This process will help to maintain the day-to-day operations of the transport company, minimising disruption to services.

However, it is worth noting that simplified restructuring is a complex process, which requires the professional assistance of an experienced restructuring advisor. In addition, the effectiveness of the restructuring also depends on choosing the right restructuring architecture and communicating and cooperating with stakeholders, including creditors.