More Than Half of EU-U.K. Businesses Hit by Brexit and Covid Delays

(Bloomberg) -- More than half of businesses moving goods from the European Union to the U.K. have experienced delays since Jan. 1 due to Brexit red tape and virus restrictions, according to a survey.

The research by the Chartered Institute of Procurement and Supply said 60% of firms reported delays to shipments going from the bloc to Britain. More than a third of the 185 supply chain managers surveyed by CIPS said their goods had been held up for several days.

Commerce between the Britain and its largest trading partner has been hit by a double whammy of new border formalities -- such as customs declarations and rules of origin paperwork -- and the need for drivers to obtain a negative coronavirus test to enter France. Delays are likely to get worse before they get better because freight volumes so far have been low, said John Glen, an economist at CIPS.

“As the transportation of goods grows, so will the queues,” Glen said in a statement. “Businesses may be forced to limit or halt production to cope with any potential stock shortages.”

The level of traffic across the English Channel -- the busiest crossing point with the EU -- has been about 70% of normal so far in January. On average, 5% of trucks, or about 100 to 200 vehicles, are being turned away at the border daily because they lack either the correct Brexit paperwork or a virus test, Emma Churchill, director general of the Cabinet Office’s Border and Protocol Delivery Group, told a parliamentary committee on Thursday.

Traders are also facing higher charges to move goods, with haulers raising rates to compensate for the delays and disruption.

Tony Shally, managing director of Espace Europe Ltd., which helps facilitate freight deliveries, said a French haulier he works with is charging customers 60% more to cover the cost not only of bringing goods from the continent to the U.K. but also of trucks returning empty to the bloc without a so-called back-load.

He said the cost of moving a load from Paris to Birmingham, England, is normally about 1,500 pounds ($2,100), but now haulers are charging roughly 2,200 pounds for the same load.

“The appetite to come into the U.K. from EU haulers now is zero,” Shally said. “All the access I had to trucks has gone.”

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