Date: 11.11.2020

Logistics association highlight economic cost of No Deal Brexit

Logistics UK, the revamped Freight Transport Association (FTA), has warned that a No-Deal Brexit could have a significant effect on the price of all imported goods and could drive inflation up as a result.

“Everyday household items we import will become more expensive under World Trade Organisation tariffs,” writes David Wells, the association’s CEO, “some by 30% or more.  This will make the household shopping basket much more expensive, particularly in the early part of 2021 when we rely on imports for much of our fresh food. 

“The actual cost of moving goods will also increase,” he continues, “if new vehicles, parts and tyres are also subject to tariffs. This is more than ‘turbulence’, as suggested by Mr Gove recently and logistics businesses, operating on 2% margins, cannot afford to take on these costs.”

Another concern for logistics operators will be obtaining access to the EU market if the talks remain unresolved, as without a deal, UK hauliers will also be restricted by the number of lorry access permits available to enter the EU. “The permit quota available to UK operators will fall short by a factor of four, putting businesses at risk right across the country. We are urging government to keep pressing for a deal with Brussels, to protect not only our industry but the economy as a whole.” 

Elizabeth de Jong, policy director at Logistics UK, added: “Logistics UK has been working closely with the government for some time to highlight the issues which could affect the smooth passage of goods through the supply chain at the the end of the transition period.  

“Much has been achieved but there is still much to be done if disruption is to be avoided from 1st January 2021, with detail still required in order for logistics operators to brief and train staff, and adopt new processes for declarations, tariff calculation and payments. As always, we stand ready to provide all support necessary to make Brexit a success but need the government to provide us with the information we require, in detail and at pace.”

With COVID, Brexit, new technology and other disruptive forces driving change in the way goods move across borders and through the supply chain, efficient supply chains have never been more important.

Metro’s ‘Brexit Ready’ web portal has been designed to prepare your business for the 1st January 2021.

For further information on Metro’s brokerage services and automated solutions, please contact Grant Liddell or Chris Carlile who are leading our 2021 EU withdrawal Task Team.