What will Brexit mean for Road Freight?

What will Brexit mean for Road Freight?

June 20th 2018

People are making twice as many journeys as they did in 1970 and the same is true of businesses whose freight needs to be transported.

In a study conducted by Transparency Market Research (TMR), the current global market was valued at $8.1tn but this is predicted to grow to $15.5tn in 2023. Volumes, estimated to be 54.6bn tonnes in 2015, are likely to reach 92.1bn tonnes by 2024.

The UK logistics industry alone accounts for 13.2% of GDP which means with the un-certainty surrounding Brexit at the moment with the looming deadline and still no deal established, many in the Logistics sector are becoming increasingly inpatient and focusing on processes to make sure they are Brexit-proof.

Of course, becoming Brexit-proof during an exit of the European Union is something that international freight forwarders can find tricky. Especially when some of the policies such as free movement are the reason that freight can be transported port to port or border to border with little-no documentation checks, allowing for EU freight to be transported faster and offer the best rates and times to customers and clients.  This is especially a growing concern when it comes to road freight as 44% of all UK’s exports are distributed to countries in the EU.

Huge back-logs of road-freight and delivery times could also suffer, for example when the French go on strike at ports an air field is used in that goes through a little village, this could disrupt local communities such as the village of Stanford who are already fighting the proposed lorry park that is set to hold 1500 lorries.  if lorries are stuck there whilst strikes are on or when waiting to pass through freight are on the back of these trucks will be delayed and customers will be angry.

According to a study conducted by Moor Stephens “Over 60% of firms believe that Brexit will have a negative impact on their business”.

Priorities for Brexit Negotiations

To maintain the GDP, jobs in the freight industry and to be able to offer competitive prices players in the freight industry should start taking action now, in case a no Brexit-deal happens. This can be done by researching background issues and turning threats into opportunities.

Road haulage is especially at risk of being affected due to the industry needing EU drivers who know EU roads, to work for UK companies. With freedom of movement at risk the industry’s ability to serve the economy could be compromised. To solve this issue there should be more UK training investment from the government.

Another issue road freight may come up against is the weakened pound. The AA suggest that Fuel will increase which will lead for more innovative need and reliance on more sustainable energy. With all the potential issues Brexit will bring to road freight will the service become a thing of the past?

On a positive note, Professor Alan Braithwaite says ‘established patterns of trade are difficult to change quickly because of capacity, all the time trade flows we need logistics’.

 In the long run there could be possible better trade deals which may provide opportunity for new business however, it’s better to position yourself ready rather than not.

What do you think about Brexit having an effect on road freight? Are you apprehensive for the transition? Leave your comments below!