Real change in transport prices by mode (TERM 020) - Assessment published Sep 2010
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Transport (Primary topic)
Typology: Descriptive indicator (Type A – What is happening to the environment and to humans?)
- TERM 020
Key policy question: Are passenger transport prices increasing at a higher rate than consumer prices? Are transport prices givin appropriate signals to transport users?
On average over the period 1998 to 2008, passenger transport prices have increased at a higher rate than consumer prices, with the exception of the purchase of passenger cars, and more recently, air travel. For freight transport prices, no EU-wide data exists, but as an example in the UK road freight prices have increased by a small amount over this period.
Real price indices of passenger transport based on a fixed transport product in the EU 25 Member States (2005=100)
Note: Real change in passenger and freight transport prices by mode. On average over the period 1998 to 2008, passenger transport prices have increased at a higher rate than consumer prices, with the exception of the purchase of passenger cars, and more recently, air travel. For freight transport prices, no EU-wide data exists, but as an example in the UK road freight prices have increased by a small amount over this period.
Eurostat - Harmonised Indices of Consumer Prices, Economy and finance (data)/Prices/Harmonised Indices of Consumer Prices (HICP)/ Harmonised Indices of Consumer Prices (2005=100) – Annual Data (Average Index and rate of change).
Prices are relatively easy to measure and compare over time, as long as the product or service in question stays the same. However, there are variations that take place over time that can affect the reliability of the comparison. For example, people tend not to purchase the same cars as ten years ago, and don't use the same package of transport services (price/quality) as previously.
Therefore, only limited conclusions about trends in transport prices can only be drawn. Most care should be taken when interpreting the prices related to the purchasing of cars and air travel prices. The price and quality characteristics of these products have changed the most during the recent years. For example, in air transport, increasing share of travellers are choosing low-cost carriers that offer less service for lower prices.
Transport price indices for the EU-15 Member States show that real (inflation adjusted) passenger transport prices have increased, making transport services more expensive in comparison with other consumer goods and services. Differences appear between countries and modes.
Vehicle purchase prices have grown substantially less than average consumer prices, making it easier for people to afford a car. This may, probably in combination with rising real incomes, have been an important driving force behind the increased vehicle ownership in the EU (see TERM32 Size and Composition of the Vehicle Fleet). Increased vehicle ownership is the primary driver behind increased choice of cars as a transport mode. This often leads to increased transport demand and subsequent environmental pressures as the costs for vehicle use are relatively low and many cost items are fixed (e.g. depreciation, insurance and holder's tax). Similar trends are seen in the newer Member States as greater affordability of car purchases is even more pronounced. However, the effect of the availability of cheaper passenger cars is probably smaller than depicted, as people do not tend to purchase the same types of cars as ten years ago. Instead, households may purchase larger and more luxurious cars, spending an even greater share of their income on vehicle purchase than before (see TERM24 - Expenditures on Personal Mobility).
Air transport prices have been gradually rising since 2000, but since 2005 have begun to decline. In the past, these rises in the price indices have not been regarded as representative due to the growing market share of low-cost airlines and greater competition.
Specific policy question: Are freight transport prices increasing?
Real Price UK Freight Price Indices (2005=100)
Note: Case study of the United Kingdom: prices for freight transport on commercial ferries, by road and by sea between 1998 and 2008
UK National Statistics, National Statistics/Services Producer Prices Index (experiemental)/Q1 2009 Data. http://www.statistics.gov.uk/statbase/product.asp?vlnk=7351,
Less information is available regarding freight prices. Using a case study of the United Kingdom, prices for freight transport on commercial ferries and by road have increased over the period 1998 to 2008. Prices for freight transported by sea however have declined over this period (see Figure 2). The cost decreases for water transport are largely a result of economies of scale (larger ships and longer distances).
Transport statistics (Eurostat)
provided by Eurostat - Statistical Office of the European Union (ESTAT)
UK Freight Prices
More information about this indicator
See this indicator specification for more details.