The Ro/Ro shipping industry is expected to see strong growth in 2025, driven mainly by long-term contracts and continued growth in global vehicle export demand. Despite the challenges of transporting heavy equipment, major operators such as Höegh Autoliners and Wallenius Wilhelmsen managed to secure record freight prices, providing a solid financial foundation for the coming years.
Continuing the success of 2024, the main operators in the Ro/Ro industry are expected to continue to grow. Leading vehicle transport company Höegh Autoliners reported that as of the end of last year, about 80% of its shipments in 2025 and 2026 had passed long-term contract lockdowns. These contracts last an average of 30 months and net freight rates exceed $100 per cubic meter, says CEO Andreas Enger.
Wallenius Wilhelmsen is of the same opinion, with President and CEO Lasse Kristoffersen stating that the company has secured a total of $89 billion in multi-year contracts worth more than $1 billion each, which will provide financial stability for the coming years.
Meanwhile, Japan's top three vehicle carriers K-Line, MOL and NYK also forecast continued growth in demand, despite still facing port congestion.
One of the main drivers of the success of the Ro/Ro industry is the ongoing global demand for vehicle exports. Despite concerns about a drop in ship leasing rates and weak vehicle sales at the end of 2024, the trend has stabilized for the time being. It is noteworthy that, according to data cited by Höegh Autoliners, Chinese vehicle exports grew by 20% year-on-year to reach 590 million vehicles in 2024.
In addition, the decrease in ship leasing rates enables operators to expand their fleets at more competitive prices, ensuring service reliability and profitability.
Despite market concerns about the impact of tariffs on imported vehicles, industry leaders believe the impact will be limited. Enger noted that U.S. tariffs on vehicle imports from Mexico and Canada are less likely to significantly affect shipments. In addition, tariffs imposed by the European Union on Chinese electric vehicle (EV) imports have been offset by Chinese manufacturers shifting to hybrid vehicle exports.
Data from Höegh Autoliners showed that, despite an 11% drop in imports of electric vehicles from China to the EU in 2024, hybrid imports rose by 127% to reach 16.8 million vehicles, fully demonstrating the flexibility of manufacturers in the face of changes in trade policy.
While the vehicle transport business continued to be strong, heavy equipment transport, such as construction and agricultural machinery, was weaker. Heavy equipment shipments in the fourth quarter of 2024 fell 29% year-on-year, reaching the lowest level since 2019, the WalleniusWilhelmsen report.
However, Kristoffersen remains optimistic, saying the trend enables the company to devote more effort to immediate shipments. In addition, despite high interest rates and rising costs affecting the market, the construction and agricultural machinery markets have shown signs of recovery, which could lead to a rebound in shipments later this year.
Financially, the Ro/Ro industry performed solidly in 2024. Höeghautoliners net profit grew 5% to $6.2 billion in 2024, while revenue fell slightly to nearly $14 billion. WalleniusWilhelmsen's net profit grew 9% to $11 million and revenue increased to $53 million.
With solid contract reserves, strong demand for vehicle exports, and strategic adjustments to trade policy changes, the Ro/Ro industry is expected to achieve profitable growth in 2025. Although the heavy equipment market remains challenging, major operators remain confident in the long-term stability and development of the industry.
Reference: https://www.joc.com/article/long-term-contracts-expected-to-lift-roro-operators-to-healthy-2025-5944325
