The logistics industry is now ramping up preparations for a no-deal Brexit after Theresa May’ s Government rejected calls to rule out exiting the EU without a deal on March 29, during Tuesday’s vote in the House of Commons.

Robert Keen, director general of the British International Freight Association (BIFA), told his members to prepare for a ‘hard Brexit’.

“Speculating about any other outcome is inadvisable until the UK Government provides us with clear guidelines,” he said.

Keen warned that a hard deal may be very disruptive and damaging for the UK economy as a whole, but that freight forwarders will play a key role in “tidying up the mess left by politicians” by ensuring importers and importers can continue trading with Europe without disruption.

James Hookham, deputy CEO at the Freight Transport Association (FTA), claimed a no-deal Brexit would be “highly damaging for trade, for business and for Britain.”

He added that the risk of a no-deal Brexit has risen significantly and that this would cause problems for businesses as there is virtually no time to prepare, which would be catastrophic for the UK’s supply chain.

He said the logistics sector, including dependent industries such as retail and manufacturing, represents 22% of all UK companies and employs a third of the country’s workforce. He also said that that a no-deal will cause delays at the border, increase costs and Customs checks and squeeze the narrow margins of logistics businesses even further, he told The Loadstar.

Theresa May’s defeat may have edged the prospect of no-deal closer than ever before, but the Prime Minister narrowly survived a ‘no confidence’ vote on Wednesday which could have triggered a general election. Furthermore, with the majority of parliament dead-set against leaving the EU without a deal, there may yet be further plot twists in this two-year Brexit debacle.

A key concern for many is the potential delays at the Port of Dover, the UK’s primary cargo gateway for ro-ro traffic with the EU. The port handles around 7000 vehicles per day, prompting warnings of “chaos” and traffic jams should cargo trucks be held up for customs clearance.   

These fears may be overblown, however.

Customs specialist Agency Sector Management (ASM) noted there are plans in place to continue handling the current volume of imports and exports. ASM chairman Peter MacSwiney said there would be no “mandatory reporting to the frontier for either exports or imports”.

In France, the head of the port of Calais reportedly said a no-deal Brexit would not cause delays, despite concerns over the 16,000 trucks passing through the port at peak periods. “The trucks will be passing as they are doing today,” he told the BBC.

No-deal Brexit planner Robert Hardy, operations director at Oakland Invicta, said there would be challenges, but claimed reports of chaos were exaggerated. In a radio interview with LBC, he said imports “will be ok”, but added that “all food will be required to go to a border inspection point in Calais which hasn’t yet been built.”

Whether the talk of chaos and delays prove overblown or not, it seems inevitable shippers are going to bear some additional costs.

For example, last week, European short sea shipping line Samskip introduced a “Pre-Brexit Peak Volume Surcharge”. The carrier said the move was necessary to offset costs resulting from increased demand for its ferry services which avoid ports in southern England. Samskip’s North Sea services include 14 weekly sailings linking Rotterdam, Amsterdam and Gent to Hull, Tilbury, Grangemouth and Belfast.

“We foresee that demand will outstrip supply before abruptly reducing in April as stock is first built up in February and March and then consumed in April before a restart at some point in late April / May,” said Jerome Feuvrier, Samskip’s CCO, according to The Loadstar.