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Over the past few months, the transport sector has taken a hard hit as a result of the coronavirus crisis, tax changes and Brexit, leaving the UK over 100,000 drivers short and many businesses struggling with reduced stock and delayed deliveries.
According to new research from Trident Worldwide, 50% of UK business decision-makers felt that Brexit uncertainty had negatively impacted their supply chain within the last five years.
Custom Changes
Changes to customs have been introduced as the free trade between Britain and the EU came to an end. This has resulted in more paperwork and high product standards which are more strictly reviewed, particularly for restricted goods and livestock.
Supply-Chain Disruption
Disruption to the supply chain has caused huge delays in customs checks at British ports, resulting in a backlog of stock to major industries such as grocery and manufacturing. (Though this is due to ease following an adjustment period)
Changes to Regulation
The UK’s regulation has changed from the European standards for workers’ rights and consumer protection.
The first quarter of this year saw the effects of Brexit come into action, with British exports to the EU falling by 40% since Q1 2020, while imports from the EU to the UK were nearly 29% lower.
The new administrative requirements, customs, restrictive COVID-19 rules and traffic jams at the border caused many hauliers to stop their services to and from the UK. With lower transport availability, the rates skyrocketed, with the doubling of some transport costs because of the lack of lorries.
By the start of the second quarter, customs protocols and processes stabilised at the EU/UK borders (excluding Northern Ireland), with cargo moving seamlessly. The downside, of course, were the higher rates which were roughly 25% higher on the most popular routes.
Additionally, costs increased as the need for customs clearances increased, adding on £100 on average to a movement for both the export and import customs entry and related processes into and out of Europe.
The lack of drivers available amounted to around 100,000, largely down to the mass departure of EU lorry drivers from the UK as a result of the pandemic and Brexit. These were estimated to have made up about 35% of the total drivers in the UK.
European road freight costs increased by over 8% in May to a three-year high as available capacity plummeted to a four-year low.
It has been made clear that haulage companies will have to quickly adapt to a new way of working. Haulage Exchange has revealed that 56% of haulage companies have moved some of their operations to the EU or would consider doing so in the future.
Almost a third of respondents to the Haulage Exchange survey said they would avoid working with food and drinks industry clients due to the issues surrounding Brexit whilst 25% said they are reluctant to work with livestock farming and agricultural farming. 19% would avoid gardening supply and 13% retail.
On 20th July 2021, the government announced a series of measures to try to resolve the shortage of drivers. These include:
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