Truck and Track Spring 2021

www.truckandtrack.com Spring 2021 Truck and Track 23 BREXIT - DESCARTES Brexit Realities In March 2021, Descartes commissioned independent research to assess the specific elements of EU trade that have been affected, as well as the resultant disruption, the level of preparedness for Brexit and the expected performance of supply chains in 2021. ■ Mixed performance: 43% of businesses have been impacted negatively by Brexit in 2021 – but 19% of businesses are thriving in a post-Brexit world ■ Disruption reality: 90% of businesses have faced disruption since the end of the transition period ■ Economic impact of Brexit: 53% expect their 2021 turnover to be lower than if the UK had remained in the EU – and the average reduction is 29% ■ Preparation delay: 46% of Brexit preparations happened during 2020, especially during the second half of the year ■ Pandemic impact: 76% had their Brexit response disrupted by Covid-19 Reportshavehighlightedthatdelays importingandexportinggoods to and from the EU have worsened since Brexit was introduced at the start of the year, possibly leading to stock shortages and price rises for consumers. But, as this recent research reveals, the post-Brexit trade situation is far more nuanced. Yes, disruption is a reality: 9 in 10 companies have experienced disruption in their ability to trade in and out of the EU in 2021. At the same time, almost one fifth (19%) are actually thriving in a post-Brexit economy, with 35% of electronics, computer and telecommunications companies enjoying a positive outcome. So what differentiates those businesses that are enjoying post- Brexit success? Challenging Outlook The immediate effect of the Brexit and Covid-19 double whammy is clear: European trade overall is down. French exports to the UK fell by 13% in January compared to the average of the previous six months and French imports from the UK plummeted by 20%, according to French customs officials. German exports also fell, down roughly 30% year-on-year – accelerating a decline in trade between the two countries since the Brexit referendum in 2016. But is this drop in trade justified – and will it continue? Confidence is a huge component of successful business and our survey We didn’t take any steps to prepare 13 % 24 % 11 % In the second half of 2020 31 % 18 % 18 % In the first half of 2020 20 % 18 % 33 %* In the second half of 2019 15 % 13 % 24 %* Don’t know/ Not sure In the first half of 2019 10 % 7 % 6 % In the second half of 2018 4 % 5 % 3 % In the first half of 2018 0 % 2 % 2 % Before 2018 2 % 2 % 2 % 3 % 12 % 0 % When did you start preparing your company for Brexit? Strugglers Survivors Thrivers * Businesses that are doing well since Brexit in 2021 are more likely to have started preparing in the second half of 2019 (24%) or the first half of 2020 (33%) compared to companies who aren’t.