CEOs in the global transport and logistics industry are less optimistic about growing their business than they were last year, according to PricewaterhouseCoopers.

A third of the 67 CEOs interviewed for PwC’s Annual Global CEO Survey said they are confident about increasing their companies’ revenues over the next 12 months, compared to over 90% of respondents in PwC’s CEO survey at the same time last year.

The fall in confidence comes as no surprise given that the airline sector is experiencing falling demand from consumers and business travellers as well as being hard hit by the decline in exports from Asia.

The railway sector, which makes much of its revenues from the transportation of steel and cars, is likewise gearing up for a massive drop in cargo volumes.

Container shipping has nosedived, with freight rates for dry-bulk shipping plummeting by as much as 90%, and the trucking sector is also feeling the pinch.

“The global economic slowdown is hurting every area of the transport and logistics industry. Every CEO will have to make tough decisions about what actions are required to ensure his or her company’s short-term survival,” says Todd Thornton, PwC Canada’s transportation and logistics practice leader.

Despite this reduction in demand, transport and logistics CEOs are more positive about the medium-term outlook — 75% are somewhat or very confident that the industry as a whole will pick up over the next three years. Twenty-two per cent also have their eyes on new geographic markets for expansion.

However there are a number of challenges on the horizon. While 40% of respondents plan to increase the number of people they employ over the next 12 months, over 30% anticipate having to downsize.

Non-renewable energy tops the list of issues about which transport and logistics CEOs worry. Eighty-four per cent are looking for operational improvements to reduce energy consumption; 52% are turning to alternative energy sources and 33% are investing in energy-efficient technologies.

IE