Brexit preparations squeeze UK logistics firms' profit margins
UK logistics firms are struggling to finance their preparations for Brexit on account of shrinking profit margins, according to the 2019 Logistics Report published by FTA that represents the interests of 17,000 logistics businesses
UK logistics firms are struggling to finance their preparations for Brexit on account of shrinking profit margins, according to the 2019 Logistics Report published by FTA that represents the interests of 17,000 logistics businesses.
The report surveyed the opinions of 500 freight and logistics companies operating in the UK and internationally, to gather industry insights into the latest political and economic developments.
FTA director of UK policy Elizabeth de Jong was quoted as saying in a report by London's Air Cargo News: 'Profit margins were only two per cent 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 per cent of respondents had not taken any action to prepare for Brexit and only 17 per cent had created a plan for a No Deal Brexit.'
The survey also indicated that the uncertainties surrounding Brexit are taking their toll on the logistics industry, with 61 per cent of respondents saying this uncertainty is a barrier to the expansion of their businesses worldwide.
Furthermore, the report showed that the UK's global competitiveness has declined significantly and investment in the UK's transport and logistics infrastructure is urgently needed to improve its attractiveness to international investors.
Ms de Jong continued: 'Logistics businesses are also concerned about how the UK's departure from the European Union (EU) will impact their workforce; 80 per cent of respondents say the employment status of EU workers is their most pressing Brexit challenge.'
She added that 13 per cent of HGV [truck] drivers currently working in the UK are EU nationals and that the continued residency of these workers is not guaranteed post-Brexit: 'The 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.'