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Aeolus Perspectives 22nd Edition: The dawning day after Brexit, which are the impacts on logistics and transportation?


Poster with the flag of Europe

Brexit - effective since January 1st - brought with it more complexity in the supply chain management, lengthened delivery times and so increased costs.

So, in the end, Brexit has arrived, silently and somewhat gone unnoticed because of the Covid-19 pandemic emergency but seemly without never any real chance to be avoided. Even if the hard Brexit with the eventual customs duties as well have been dodged at the last minute, some expected consequences were not long in coming. Since January 1st, transport and logistics (T&L) companies have to deal with new rules and all the already foreseen troubles due to Brexit: queues at borders, delays in deliveries, rising prices. One of the main problems also concerns how to fill the customs documents for access to Great Britain. This difficulty is discouraging several T&L operators and, above all, the small companies that are less prompt to face these kinds of matters.

Troubles for T&L companies

After only a few weeks from the re-establishment of customs controls between the UK and the EU, many road transport operators are already starting to refuse trips because of both the growing complexity and the multiplied customs duties.

The new rules that came with the full application of Brexit are meaningfully increasing the rates for road transport to and from the UK - it should be already doubled according to the first estimates! That is a consequence of the lengthened awaiting times for customs control checks. More is the time, more is the cost. Some goods - such as fresh food, for example - cannot bear elongation in timing too much.

In the long run, all this could penalize some production chains and, ultimately, the same consumers who could find themselves penalized by less efficient delivery services, low stocks in stores, and higher market prices.

And bothers for customers

Some real effects are already being felt such as, for example, the interruption of fish exports from Scotland, the empty shelves in some mega stores all around Europe, the shortage of the food products in the "block list" seen in some supermarkets in Northern Ireland, the suspension of deliveries from and to the UK by some couriers, and so on. Many others could be coming soon. The widespread feeling is the worst consequences are coming true mostly uncontested. That is despite they were widely foreseen and largely announced, the most. 

What’s next?

Faced with this worrying scenario, but - alas - really not surprising, it is difficult to make predictions: which sectors will be most affected by Brexit? What would be the main consequences for international supply chain management? What on the EU/global economics system? And what for the consumer market? In the fog of uncertainty, many propose to follow the beacon of simplification and collaboration. In the meanwhile, what remains is to get used to a new probably no return situation.

TAGS: Aeolus perspectives, Transportation, Logistics