Getlink SE: Navigating Truck Traffic Headwinds with Infrastructure Resilience and ESG Momentum

The Channel Tunnel, the vital artery linking the UK and continental Europe, faces a crossroads. While truck traffic through Getlink SE's operations dipped by 4% year-on-year in June 2025, signaling near-term pressures from Brexit-driven trade shifts and logistical competition, the company's broader strategic moats—infrastructure dominance, ESG alignment, and long-term concessions—position it as a resilient investment play. This analysis explores whether the recent decline is a fleeting headwind or a structural threat, while highlighting why Getlink's diversified model and sustainability focus justify a buy recommendation.

1. Truck Traffic Decline: Temporary Hurdle or Structural Shift?

The June 2025 truck traffic figures—93,726 vehicles, a 4% YoY drop—mark the sharpest monthly decline since Brexit's full trade regime took effect in 2024. Year-to-date (YTD) truck traffic is down 2%, underscoring lingering trade frictions. Analysts attribute this to three factors:

• Brexit-Induced Trade Dynamics: Post-TCA regulatory hurdles, including delayed customs checks and SPS inspections, have raised costs for SMEs, deterring cross-Channel trucking. A May 2025 UK-EU deal eased agrifood checks but left other sectors exposed.
• Ferry Competition: Ferries like P&O's new hybrid vessels and rival routes (e.g., Dover-Calais) are capturing share, especially for time-sensitive goods.
• Calendar Effects: Shifted holiday periods and seasonal demand patterns may have skewed June's figures, as noted in Getlink's Q2 report.

However, passenger vehicle traffic shows resilience: 215,751 vehicles in June (down 1% MoM) and 1.8% YTD growth reflect the Tunnel's reliability for leisure and business travel. This divergence suggests truck traffic's decline is not yet structural, but a mix of temporary factors and sector-specific challenges.

2. Strategic Resilience: Smart Borders and ElecLink as Growth Catalysts

Getlink's infrastructure and innovation counterbalance near-term truck headwinds:

• The "Smart Border" Advantage: Launched in 2020, this system reduced customs delays by 30% via AI-driven document processing and real-time tracking. With 36.4% market share in truck traffic, Getlink's operational efficiency retains a competitive edge over ports and ferries.
• ElecLink Synergy: The €33M Q1 revenue from the UK-France electricity interconnector—now 83% pre-booked for 2025—diversifies income. Integrating energy trade with freight traffic creates a cross-sector revenue engine.
• Acquisition-Driven Logistics: 2024 purchases of Associated Shipping Agencies (ASA) and Boulogne International Maritime Services (BIMS) expanded Getlink's logistics ecosystem, enabling end-to-end supply chain solutions for clients.

These moves align with ESG priorities: The Tunnel's low-carbon rail freight (vs. trucking) and ElecLink's green energy trade position Getlink as a climate-conscious infrastructure leader. This aligns with EU emissions targets and investor demand for sustainability-focused assets.

3. ESG Momentum and the 2086 Concession: A Long-Lived Moat

Getlink's 2086 concession for the Channel Tunnel grants it a monopoly over rail freight between Folkestone and Calais. Combined with its ESG initiatives, this creates a decades-long cash flow machine:

• Green Bond Refinancing: €1.5B raised in 2024 finances low-carbon projects, lowering debt costs and attracting ESG investors.
• Carbon Efficiency: Rail freight emits 40% less CO2 per tonne-km than trucking, making Getlink's services a climate-conscious choice for shippers.
• Regulatory Tailwinds: EU transport decarbonization policies and the UK's net-zero goals will likely favor rail over road freight over time.

The financials reinforce this thesis: A 51.8% EBITDA margin and €1.2B annual free cash flow (vs. a €14.5B market cap) imply undervaluation. With shares at €16.37—below the €18.37 consensus target—Getlink offers a compelling risk/reward.

4. Investment Thesis: Buy on Dip, Target €18.37

Why Buy Now?- Cyclically Discounted Valuation: The truck traffic dip is temporary, with July's data (due August 7) likely showing seasonal recovery.- ESG and Concession Durability: Getlink's climate-aligned model and 61-year concession provide a floor for cash flows.- Diversification Payoff: ElecLink and logistics acquisitions reduce reliance on freight alone.

Risks:- Prolonged trade declines if Brexit barriers escalate.- Overcapacity in cross-Channel ferries.

Actionable Takeaway: Accumulate positions at current levels. Investors should monitor July traffic data and ElecLink's 2026 expansion plans. A 12–18 month target of €18.37 reflects fair value for Getlink's fortress balance sheet and strategic moats.

Conclusion

Getlink SE's truck traffic decline is a speed bump on a superhighway of infrastructure resilience and ESG-driven growth. With its dominant position, smart border tech, and green interconnector synergies, Getlink is primed to capitalize on post-Brexit trade evolution and climate policies. For investors seeking a long-term, low-risk play in European infrastructure, the dip to €16.37 is a strategic entry point. Buy with a bullish outlook.