The research comprised 27 in-depth interviews with haulage managers, from freight forwarders providing haulage services to clients/customers, and private carrier companies operating their own fleets to transport their own goods.
The sample included companies of varying sizes, based across a range of UK locations, and using a range of UK ports and crossings when carrying goods between the UK and EU.
Here we take a look at some of the key findings from the research.
1. Brexit has increased costs and lengthened transport times
The report states that in immediate aftermath of the UK leaving the European Single Market, “extreme disruption meant that many of the large private carriers in our sample stated that they were running at reduced capacity, whilst small and medium companies reported stopping or reducing their trade to the EU, choosing instead to focus on UK trade. Depots across the UK and EU reported goods sitting in warehouses unable to be shipped.”
Since then, companies have adapted in different ways by using digital logistics systems, engaging with 3PL’s, or hiring more staff – including those with experience of UK customs prior to the country joining the single market.
“We’ve restructured the team, so we’ve got each person focusing on each country. They know the ins and outs; they know the paperwork and deal with it day in day out,” said one Large freight forwarder. Another freight forwarder, also described as large, said “The TMS tells us about any paperwork associated with the job that we might need to do to go abroad.”
A medium-sized forwarder added:
“We’ve had to outsource to a logistics agency to deal with the legal perspective and documentation for crossings. We had to resort to that because you’d do a crossing and then a day later, same lorry, same weight of load, same time, and you’d be told you needed all these different forms; we were left with no choice but to outsource for help with that.”
Small and medium-sized forwarders were said to have turned to 3rd parties in particular due to the customs barriers, with many saying the extra cost was largely viewed to be a necessary expenditure to avoid delays and lost loads, which are more damaging to business.
Unfortunately, the report found that this has not always been effective in helping to avoid delays. Citing an example, the report included the following quote from a small freight forwarder:
“I had a driver in Poland, and he was stuck there for three days, because the company who did the paperwork for us mistook a three for an eight. We’re losing between one and half to two loads a month, it is having a dramatic effect on the overall turnover.”
2. High fuel costs can convince hauliers to take longer, more expensive sea crossings
The research found that companies based in the North of England/Scotland had reported that rises in the cost of fuel encouraged the short term use of more expensive but closer crossings, as the cost of the crossing is offset by savings in the cost of fuel.
The research highlights the example of using the Hull/Rotterdam crossing instead of driving south to Dover/Calais. The report adds that this trend could continue into the long term as long as fuel costs remain high.
“If you ship from Hull, your ferry crossing is hugely expensive. So you’re looking at that and factoring in the 12-hour crossing time vs the drive down to Dover to cross the quickest, cheapest way. It’s much of a muchness now, because of the fuel nowadays,” a large private carrier was quoted as saying.
The report also quoted a large freight forwarder who had done similar, albeit due to the P&O ferry disruption last year:
“Because of the [large ferry company] delays and issues any northern shipments we now ship out of Hull. If you’ve got a shipment from Yorkshire, there’s no point sending it down to Dover because what you may make up in crossing time, you’d use up in transit time down to Dover.”
3. The EU Mobility Package is also impacting UK supply chains
Although the UK is outside the European Union, it has implemented most of the provisions of the EU Mobility Package.
This means the return of drivers and trucks rule still applies – much to frustration of one large private carrier, who told the DfT researchers:
“I think if some of the legislation could be changed a little bit in terms of those drivers having to go back to their origin country for one week, every month. As I’ve said, a lot of our drivers are Polish so if the government could look at that legislation a little bit more to make it a little bit easier.”
4. Larger companies set to gain more market share
In recent times, haulage giants like Culina have made headlines in the industry press thanks to a number of acquisitions.
According to the DfT report, larger operators such as the Culina Group look set to grow even stronger:
“Larger and more established haulage companies can provide resilience and business continuity, reversing what they see as the previous trend favouring small scale and freelance freight forwarders. Many have increased their administrative departments to build resilience to the perceived increase in customs paperwork,” sats the DfT report.
Larger companies are also likely to have the resources to deal with post-Brexit paperwork, which is important in respect of this finding stipulated in the report:
“A niche has been created for haulage companies that understand new regulations and are able to handle the increased complexity in logistics. Some companies also enjoyed business growth during the pandemic and are now in a position to capitalise on that growth/momentum.”
5. Hauliers want support to address driver shortage, fuel costs and customs procedures
Hauliers interviewed by the DfT researchers called for more consultation on future regulation changes, as the streamlining of customs processes where possible, and support for improving conditions for drivers.
Interventions to improve driver shortages, including development of training schemes such as apprenticeships, was another wish. Some also suggested tackling driver shortages through making it easier for EU drivers to enter and work within the UK or creating incentives to encourage younger drivers into the industry.
High fuel prices were another problem highlighted by the industry.
“We need some sort of support when it comes to the fuel prices. I mean, we’re touching nearly two pounds a litre now. We can’t keep going at that,” said one forwarder. Another added: The government is not really doing anything [about the increased cost of fuel] even from a transport perspective. The transport companies can’t sustain these costs, which means they will be passed onto the customer in manufacturing and products, and they then pass that to the end customer, which is us.”
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