How is the European transportation sector facing the Brexit challenge

How is the European transportation sector facing the Brexit challenge

Brexit has brought a series of changes in the European panorama, with transportation being a crucial yet delicate issue. Transport companies plan to reduce their activity with the United Kingdom due to a lack of information. On December 24, the European Union and the United Kingdom reached an agreement in accordance with the Trade and Cooperation Agreement which will define relations between the two parties once Great Britain is no longer part of the EU.

How Brexit and the pandemic are impacting the new regulations

With the Trade and Cooperation agreement between the two parties, road transport companies can continue to operate as long as they are providing point-to-point service. In other words, British trucks can arrive in the EU and return from the EU, even if they are not loaded, and vice versa, without additional fees.

In addition, cabotage is authorized for trucks from both sides, with a maximum number of two operations in each other's territory after crossing the border. The right of transit is also guaranteed through each other's territories to third countries or to other parts of their own territory. A "land bridge" is provided to allow logistical links between Ireland and the rest of the EU via the UK.

Despite this agreement, however, the creation of new borders is generating problems and doubts. The pandemic situation we are experiencing does not help either, as many countrieshave established additional security controls to prevent the spread of the new variants. Countries like Germany, for example, are demanding negative Covid-19 tests from carriers, leading to situations of collapse such as the one experienced precisely in the English Channel at the beginning of the year.

Alpega Group’s survey on transport and logistics trends in 2021

Following up, the Alpega Group has analysed the above-mentioned matter through a macro-survey of transport companies at the European level, and in which, among other aspects related to trends in logistics and transport in 2021, we asked about the impact that Brexit will have on the sector.

The survey results reflect some uncertainty. On a scale of one to ten, the level of optimism of the transport companies regarding the future of trade relations between the European Union and the United Kingdom is five. The significance of this score is highlighted by the fact that 40% of the respondents consider that the Brexit has "affected their business a lot".

Not unexpectedly, approximately 50% of these transport professionals think that their activity with the United Kingdom will be impacted in the coming months and that, as a consequence, it will decrease. Among the main reasons, at 40%, is the lack of information and the feeling that this new reality involves too much paperwork and bureaucracy, with 86% of the respondents considering this to be the case. All these concerns add complexity to the already cumbersome bureaucratic issues that are undoubtedly a headache for transport professionals.

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