Record diesel prices are squeezing trucking companies in the US and Europe, though many of Daimler Truck Holding AG’s customers can still pass the additional fuel costs on to their own clients, CEO Karin Rådström said. The majority of customers “have floaters in their contracts with their customers, which means that they are able to offset the higher diesel price,” Rådström told journalists at the IAA Transportation in Hanover. The bigger problem can be timing, because operators often have to pay for the fuel before being reimbursed.

US diesel prices pushed to another record high on Monday after surpassing $6 a gallon last week for the first time. Since the start of the hostilities in the Middle East, prices have risen more than 60%. The impact can ripple through the wider economy, with trucks carrying more than 70% of US domestic freight by weight.

North America is Daimler Truck’s biggest market, selling almost half the group’s vehicles in the region across its Freightliner and Western Star brands. Rådström said fuel prices haven’t yet had a noticeable impact in orders, though the wider uncertainty “obviously isn’t good for business.”

While high fuel prices could weigh on truck demand, they may also strengthen the case for switching to battery-electric vehicles, according to Achim Puchert, who heads the Mercedes-Benz Trucks business. Both companies said the biggest obstacle to wider adoption of electric trucks remains a lack of charging infrastructure.