Supply chains are being reconfigured and in many cases seem to prefer ease of transport, reduced bureaucracy and greater predictability to speed and lower costs.
There has also, I understand, been a change from normal Roll on-Roll off (Ro-Ro) to unaccompanied trailers in some cases which I assume reduces costs. The Irish haulier leaves a trailer at (say) Rosslare and small tractor units load these trailers onto the ferry which then travel unaccompanied to (say) Cherbourg, where it’s unloaded and parked in the port area waiting collection.
This may mean the costs between using one driver and the land bridge and two drivers and unaccompanied loads on a ferry is now not that much different. An Irish haulier, with freedom of movement and no limit on cabotage, could easily relocate drivers to mainland Europe for short periods.
It all seems to be working well because Cherbourg last week saw it’s 100,000th trailer roll off a ferry, three times it’s normal pre-Brexit level. Direct trade between Ireland and the EU27 is up 50 per cent with 32 new ferry services in the first year after Brexit.
However, the point is that hauliers and freight forwarders and ferry companies immediately recognised that moving goods across two borders is potentially more costly, more unpredictable and more cumbersome. They very quickly put new ferries into use and a whole new transport route sprang up more or less overnight.
I think it shows two things. Firstly, the measurable value of the single market and the elimination of international trading costs inside the EU. I don’t know what these costs are but I assume someone does and there is no doubt that there must be an overall cost saving otherwise they wouldn’t do it.
Secondly, it demonstrates how difficult things are going to get for British exporters to the EU in the future.
Imagine a customer in eastern France who has been buying something, parts or finished products or a commodity of one sort or another, from a UK based supplier. He is now faced with a lot of extra paperwork and probably delays or potential delays. This is not to mention the feeling of being snubbed, that Britain considers itself superior to the EU and can’t be subject to EU rules.
Also, that French company may also now be regarded as the legal importer and become liable in EU law for any issues arising out of the import of that good.
If the items being purchased are available elsewhere inside the bloc, from Belgium or Sweden for example, albeit previously at a higher price, there will be an advantage now to suppliers in the single market and a corresponding disadvantage to the UK supplier.
These additional costs are almost wholly related to the red tape involved in crossing the newly created EU-UK border after Brexit. This may have been obvious to you right from the outset, but the sheer extent of trade diversion has been a surprise to me.
This surely has implications for Scotland and Scottish independence. If direct trade between Scotland and the EU increased at a similar rate it would reduce the importance and impact of the land border with England. I noticed a few weeks ago a politician in Belgium was calling for the port of Antwerp to prepare for Scottish independence and no doubt people are already thinking about it.
Also, we are just a few days away from implementing the import controls that we have had to delay for 12 months because we weren’t ready. I wonder how many EU exporters supplying Ireland via the land bridge will also now see an advantage in using ferries?
It could get even worse.
