Lower demand for UK hauliers post - Brexit?
The UK road haulage sector has faced many challenges and the leave vote in the EU referendum presents it with more uncertainties.
Currently more than 40% of UK exports find their way to EU member states and were this to reduce the consequences may result in lower demand for road haulage. Even if a reduction is offset via favorable trade deals with non-EU countries these may not be so easily accessible by road.
In the short to medium term little direct impact is expected but the future is somewhat unclear. The immediate impact of the vote has been the weakened position of Sterling and as a result this could increase the cost of fuel in real terms, the impact of which is already being absorbed when purchased within the EU.
For the time being the movement of UK fleet in Europe remains unaffected although stricter border controls are a future possibility. An increase of controls may be avoided by the retention of the EU rules on free movement of goods however a move away from these principles will impact efficiency as goods will move more slowly. Reduced freedom of movement and an impairment of operating efficiency will result in the reduction of hauliers’ margins. Additionally any implementation of trade tariffs within the EU would raise the costs for exporters, and they may seek to pass this on, atleast in part, to their hauliers.
A further impact may be controls on migration and a move away from the free movement of people. A reduction in the number of EU citizens working for UK-based companies has a potential impact on the road haulage sector given the heavy reliance on drivers from EU member states. Were this to be the case hauliers will be faced with an increased need to invest in the recruitment and training UK drivers at a time when they will be under pressure from other potential impacts.