On 25 January 2021, the Logistics Alliance Germany Funding Association hosted the German-British Logistics Forum as an online event under the slogan of "Questions and Solutions on the Impact of Brexit on the Logistics Industry”.
The board of the Funding Association would like to thank all participants and everybody who was involved for their contributions to this successful and topical event. The large number of participants (more than 100) reflects the great interest among professionals in the topic.
At the beginning of the event, Steffen Bilger, Parliamentary State Secretary at the Federal Ministry of Transport and Digital Infrastructure as well as Federal Government Coordinator for Freight Transport and Logistics gave a welcome address to the participants of the event. He expressed his regret that it had not been possible to take the delegation trip that had been planned on the occasion of Brexit and promised to do this as soon as it became possible again. Mr Bilger emphasised that there was great interest in continuing the exchange of goods with Great Britain at a high level. He stated that it was thanks to the EU Commission's tireless efforts to continue negotiations that this was possible at all. Mr Bilger explained that, Great Britain was de facto a third state now and that, even though Great Britain had decided to leave the EU on its own accord, this situation unfortunately produced disadvantages that also affected the logistics sector.
In a subsequent welcome address, Marc Oedekoven, chairman of the Logistics Alliance Germany Funding Association, IQS Holding GmbH, underlined that, Brexit was finalized with the general Trade and Cooperation Agreement , but despite the Agreement there were still some challenges that had to be overcome by industry, trade and logistics. Reports of supply shortages and images of empty shelves and spoilt goods in Great Britain illustrated this. In addition, the covid-19 pandemic did not help to make the situation any easier.
Niels Beuck, CEO of the Association of German Freight Forwarders and Logistics Operators, gave a keynote speech and reported on the situation the logistics sector was in. He stressed that the impact of Brexit entailed enormous challenges also for the logistics sector and that the many parties involved did either underestimate or not understand the increased complexity that Brexit entailed. Current observations showed that many players have either not looked sufficiently into the changes or not dealt with them at all.
Professor Alan McKinnon of Kühne Logistics University explained the current situation after Brexit from a British point of view. He made clear that there were already long queues of HGVs due to difficulties with customs, but that the situation was not as bad as expected. So far, logistics operations only reached a level of 70% and the economic activity was significantly below the usual level. He assumed that the situation would worsen over the next few weeks since the companies were still not prepared for Brexit. An essential problem was the insufficient number of T1 transit documents. He stated that it was also possible to observe that major freight forwarders had stopped or significantly reduced business due to many cases of missing or faulty customs documents. This also resulted in problems with supply chains, in particular for sea fruit from Scotland, a very perishable product. Insufficient capacities also lead to significant shortages on the market.
After the keynote speeches, a panel discussion under the slogan of “Doing logistics together in troubling weather” was held. During this discussion, the current situation, fundamental problems and potential solutions for the logistics sector with regard to Brexit were debated.
It became apparent that the Brexit Agreement had been concluded at the very last minute for the business and logistics sectors and therefore there was not enough time for them to prepare. The late coordination and the fast implementation of the Agreement produced difficulties for trade and logistics. The logistics associations tried to compensate this by training staff of the member companies. Especially the British side had not been properly prepared for Brexit and the United Kingdom underestimated its impact.
With a view to the current situation in Germany, the discussion showed clearly that exports to Great Britain worked relatively well, but that the main problem were imports from Great Britain. One of the effects this had was that parking fees for freight forwarding businesses were increasing enormously, because HGV drivers had to wait for a long time for their customs documents to be fully prepared. During the discussion, representatives of logistics service providers pointed out that it took a lot of time to explain to customers how to correctly fill in their customs documents. Therefore, it was not possible to properly plan transport operations. The high consulting efforts were a major burden for logistics operators. Furthermore, it was expected that it would be a challenge for freight forwarding businesses to find drivers who were willing to transport goods to and from Great Britain. The panellists also stated that it was very difficult for businesses to receive correct and comprehensive information on the applicable requirements. They expected that some problems could be solved in the short term, but believed there would be long-term changes to the total structure of logistics processes from and to Great Britain.
With regard to the prospects for the next few weeks, the panellists expected more problems concerning transport operations from and to Great Britain. This would have an adverse impact on congestions. Therefore, the logistics service providers would have to provide even more consultation to shippers. In this context, the German logistics companies were generally well prepared. In the discussion, it was demanded that the number of customs commissioners be increased considerably to alleviate the situation at the border.
In general, it became clear at the German-British Logistics Forum, that Brexit generated significant challenges for the business and logistics sectors. However, at the same time, these challenges also held new opportunities for business development. They are catalysts and boosters for the digital transformation and for new services for existing and new customers who depend on expert knowledge concerning the handling of transport operations or generate new market potentials for the logistics sector by outsourcing their own logistics segment. There is a need for alternative locations, new (digital) procedures for handling transactions with both customers and authorities as well as new cooperation schemes that enable the establishment and operation of door-to-door transport operations between the EU and Great Britain.
The German-British Logistics Forum was organized by the Logistics Alliance Germany Funding Association in liaison with the Federal Ministry of Transport and Digital Infrastructure (BMVI). The Logistics Alliance Germany (LAG) is a joint initiative by the German logistics sector, which has formed the Funding Association, and the Federal Ministry of Transport and Digital Infrastructure. The LAG's objective is to market Germany as a centre for logistics and »Logistics made in Germany« abroad. Further information on LAG and its events can be found under www.logistics-alliance-germany.de.
Image rights: FV LAG e. V.