The Hungary freight and logistics market has been on a constant rise since the past few years and is expected to grow at a CAGR of around 6% in the coming years. The net turnover of the logistics service providers in Hungary of around HUF 3,400 billion, accounts for nearly 5% of the total net turnover of the national economy. Currently, there are 40,000 logistics companies in Hungary, of which a significant part are small and medium-sized enterprises. The Hungarian logistics sector employs 259 thousand people, which is around 6.5% of the total employment on the countries labor force. The Logistics sector accounts for 6.3% of the Hungarian gross domestic product.

Key Market Trends

Trans-European Transport Network & Infrastructure in Hungary

Due to its geographical position, Hungary occupies a central position in Europe. The country is crossed by four Trans-European Transport Corridors (TEN-T), each reaching the capital. Hungary currently has four fully operational Rail Freight Corridors: Orient-East Med, Mediterranean, Amber and Rhine Danube. It is also located at the intersection of two European Rail Traffic Management System (ERTMS) lines. Therefore, the country is acting as a ferry linking the European Union with the rest of Europe from the south (Serbia) and the north-east (Ukraine). This makes Hungary one of the most important transport hubs, providing easy access to all parts of Europe: by rail, road, air and water transport.

Over the Years, government has made huge investments to all modes of transport (rail, road, air, water) in order to develop them to the most efficient level of functioning. Further, the Hungarian government has budgeted to spend HUF 3,200 billion on road development and HUF 1,500 billion on railway development by 2022. So, for next few years extraordinary developments are expected on the entire Hungarian road and rail network.

Shift towards Intermodal Freight Transport

In Hungary currently the most utilized mode of transporting goods is through Roadways. If about 10-20% of long-distance road freight traffic would be shifted to rail and waterway transport, the environmental burden of public roads could be reduced by tens of billions of forints (HUF). There are more than 500,000 heavy goods vehicles on the roads of Budapest and within 70 km of the city every year. About 5% to 10% of this traffic could be potential business partner for rail intermodal freight transport, which would mean intermodal transport of up to 25,000 to 50,000 heavy goods trailer per year. In order to facilitate this shift from road to rail and waterways many improvements have been initiated by the Hungarian Government. The road, rail and waterway partnerships have been upgraded, allowing carriers to save costs and to compensate the significant driver shortage. Also new industrial parks, larger warehouses and logistics centers are being encouraged to build rail links.

Hungary is establishing a logistics base in the port of Trieste, Italy, on an area of 32 hectares. This will allow companies to reach the Hungarian sea exit by road or rail within 24 hours. The country has also undertaken projects to establish intermodal hubs within the framework of the National Intermodal Container Terminal Network.

Competitive Landscape

The industry is quite fragmented with many players existing in the freight and logistics market. The Hungarian logistics industry is undergoing significant developments in the field of both indoor and transport logistics, thus creating new market opportunities for existing players in the market. The initiatives taken by the government to develop the logistics market in Hungary is further motivating new players to enter the market. Some of the existing major players in the market include – APL, Austromar, Cargill, CEVA, db Schenker, JFC, KTI, Logwin, Nec Logistics, Raben, Rhenus and Yusen.

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