Sector responds to EU Referendum outcome

Special Report

Following the outcome of the EU Referendum, where the majority of those who voted decided in favour of leaving the EU (51.9 per cent compared to 48.1 per cent), key industry players have offered their views on the potential consequences and the way forward for the supply chain logistics sector.  This article includes just some of the many opinions that have come our way since the result was announced.

Only hours after the official result was declared there was another twist when David Cameron announced he was to step down as Prime Minister by October but would look to “steady the ship” in the meantime.  Mr Cameron also said that going forward “fresh leadership” was required.

On the financial front, Mark Carney, the Governor of the Bank of England, was quick to outline that the Bank would react to market and economic volatility by taking “additional measures as required as those markets adjust and the UK economy moves forward.”

Sector reaction

The Road Haulage Association (RHA) described the voting public’s decision to leave the EU as an ‘earthquake moment’ for the whole country, the economy and the industry, adding ‘we simply can’t take anything for granted’.  RHA has also urged Ministers and the Bank of England to work quickly to steady markets and nerves and emphasised that’ there’s bound to be short term turbulence but this is also an opportunity to cut red tape and get a new deal on many issues for UK hauliers.

The Freight Transport Association (FTA) has identified that coming out of union risks new costs, restrictions and bureaucratic requirements being imposed on moving goods in and out of Europe, and that additional burdens could add costs for FTA members and disrupt the UK's supply chains.  FTA is calling on the government to prioritise arrangements for international freight transport in its exit negotiations, minimising additional legislation and keeping costs as low as possible for British businesses.  FTA Chief Executive David Wells said: “Even though we are coming out of Europe politically, it remains our biggest export market and the supplier of a high proportion of our imports.  We cannot allow new bureaucratic burdens to hamper the efficient movement of exports heading for customers and imported goods destined for British consumers."

Mike Hawes, the Chief Executive of the Society of Motor Manufacturers and Traders (SMMT), the trade body for the UK automotive sector, commented: “The British public has chosen a new future out of Europe.  Government must now maintain economic stability and secure a deal with the EU which safeguards UK automotive interests.  This includes securing tariff-free access to European and other global markets, ensuring we can recruit talent from the EU and the rest of the world and making the UK the most competitive place in Europe for automotive investment.”

Rupert Pontin, Director of Valuations at Glass’s, the largest vehicle data provider in Europe, said: “This is an interesting result that sees the UK very much embark on a new chapter that is largely unwritten.  If the Brexit voters are correct in their thinking, it could create greater prosperity for the country in the long term but, over the next few months and years, the road is likely to be very bumpy. Markets will be affected, as will the value of the pound, and we expect to see consumer confidence tail off until the view of the way forward becomes clearer.  How long this will take is difficult to predict… “Whatever the outcome in the longer term, there are plenty of challenges now facing the motor industry and the UK as a whole.”

While the British International Freight Association (BIFA) is of the opinion that it is too soon to start speculating, the trade association which represents UK freight forwarders has identified that in the run up to the exit from the EU it will campaign to ensure that the movement of the UK’s visible import and export trade does not become overburdened by over complicated trade procedures.  Director General, Robert Keen stated: “BIFA is a neutral body and will now be looking at the ways in which we can support our members as the forthcoming legislative changes become apparent between now, the day that the UK formally triggers the resignation process and the date the country’s exit becomes effective.

Peter Ward, Chief Executive Officer of the United Kingdom Warehousing Association (UKWA) said of the result of the Referendum, “… this momentous decision by the UK will have serious global implications, bringing new challenges for British businesses and particularly for those within our industry.”  Mr Ward also added: “My hope now is that as new trade agreements are forged, there is no return to red tape and complex customs regulations that prove burdensome and costly for UKWA members… as usual the devil is in the detail, and we will work hard on behalf of our members to ensure those negotiating Britain’s exit fully understand the ramifications.”

Kevin Buchanan, Managing Director of Pall-Ex Group, offered the pallet network’s view “that the UK’s supply chain will be deeply affected by the referendum outcome, as it’s always relied on an efficient international logistics network. Jobs, trade and investment are all likely to be impacted.”  He further stated: “As a country, we now enter a crucial period of negotiation regarding the terms of our exit. The Government has a tricky task ahead and we urge them to listen to the concerns of businesses across the country.  Like every other company, we must now take stock of what’s happened and ensure that processes are in place to lessen the inevitable impact.”

Andrew Baxter, Managing Director of Europa Worldwide Group, who has been vocal in his support for the Vote Leave campaign, unveiled a specially designed trailer at the company’s £30 million logistics hub in Dartford to spell out his views on the outcome of the EU Referendum.  He said: “This is a great day for Britain.  Even though the world does not yet seem to realise, Britain has just taken a step that will ultimately make it economically safer and more secure.  The EU is on the wrong course.  The Euro cannot work without a superstate, and a superstate will not work in practice.  It's time for the EU to rethink its direction.”

International courier ParcelHero responded to the vote to leave the EU by calling for the Government to negotiate immediately for access to the single market, and not seek to impose tariffs on EU imports into the UK.  Head of Consumer Research, David Jinks MILT, said: “Many of ParcelHero’s SME business customers voted for Brexit and we understand entirely why they have done so.  However, we are concerned for our customers about the possibility of increased costs in sending parcels to the EU and also receiving items from the Union”… “It is our hope that negotiations between the UK Government and Brussels will ensure that the EU will not impose new tariffs on British good shipped into the EU; and that similarly the UK Government will not seek to impose tit-for-tat tariffs in return.”

Mike Danby, CEO of Advanced Supply Chain, the Bradford-based end-to-end logistics firm said of the EU referendum result: “Business is hard enough without unnecessary headwinds, and this is what the result has delivered.  My primary concern as ever, is making sure we are prepared for the new trading environment this will deliver – we need to ensure our business and our people continue to thrive.  The judgement has been made by, in my opinion, an electorate who were treated to a decidedly poor and untruthful (on both sides) electoral process.  But, we must be determined and resolute, and continue to grow our business at home and internationally.  We have always embraced change and innovated to new reflect new demands on our business, and that will still be the case outside the EU."