The Freight Transport Association (FTA) has claimed that “declining profit margins” have left logistics businesses “struggling” to fund their Brexit preparations.
This was the key finding of the 2019 Logistics Report which the FTA launched this week. The FTA polled the opinions of more than 500 freight and logistics businesses operating in the UK and internationally, to provide industry insight into the latest political and economic developments.
Elizabeth de Jong, FTA’s Director of UK Policy, commented: “FTA represents the interests of 17,000 logistics businesses; declining profit margins have left them struggling to fund their Brexit preparations. Profit margins were only 2% in 2018, making any significant financial investment very difficult to justify for any business, especially when the international trading landscape post-Brexit is still to be determined – logistics companies simply do not know what they should be planning for. It is of no surprise, then, that at the time of the survey (January 2019), 37% of respondents had not taken any action to prepare for Brexit and only 17% had created a plan for a No Deal Brexit.”
The survey indicated that the uncertainties surrounding Brexit are taking their toll on the logistics industry, with 61% of respondents saying this uncertainty is a barrier to the growth of their businesses internationally.
Ms de Jong continued: “Logistics businesses are also concerned about how the UK’s departure from the EU will impact their workforce; 80% of respondents say the employment status of EU workers is their most pressing Brexit challenge. 13% of HGV drivers currently working in the UK are EU nationals; the continued residency of these workers is not guaranteed post-Brexit. FTA is campaigning for amendments to the Future Immigration White Paper, so non-UK logistics workers are welcomed in the UK, to help address the worsening skills shortage.”
In related news, the Department for Exiting the European Union announced today (26 June) that Seamus Leheny, Policy Manager for Northern Ireland at FTA, has been selected to become a member of the Business and Trade Union Alternative Arrangements Advisory Group.
Commenting on his appointment, Leheny said: “As the organisation representing the logistics sector, it is essential FTA’s voice is included in any major discussion on the UK’s departure from the EU. So many businesses and individuals’ jobs are dependent on the continued free movememt of goods cross the border in both directions, but the lack of progress shown by politicians in sorting future arrangements in Ireland are at the heart of the stagnation of Brexit talks. On any given day, more than 13,500 Goods Vehicles cross just six of the 300 border crossings in Ireland, with the majority of freight being intermediate goods that are an integral part of all-island supply chains.
“My role in this group will be to work to preserve seamless business links between Northern Ireland and EU27 countries especially the Republic of Ireland in any Brexit negotiation and protect the interests of those organisations that we represent, as well as the wider Northern Irish economy.”