🕒 Article read time: 2 minutes
Logistics investment urgently needed to avoid economic “storm clouds”, says Logistics UK
The Chancellor should prioritise support for the logistics sector in next week’s Autumn Statement, to avert the damage that an economic downturn could cause to the nation’s finances, according to business group Logistics UK.
As David Wells OBE, the organisation’s Chief Executive explains, logistics underpins every sector of UK business, and needs to be supported to help prevent long term economic damage caused by lack of activity.
“Every single business in the UK relies on the logistics sector in order to operate effectively,” he says, “and despite the best efforts of our member businesses, storm clouds are gathering on the economic horizon.
“The industry is going backwards, both domestically and internationally, in terms of profitability, activity and investment, and needs the support of government to enable it to help turn the UK’s economic fortunes around.
“The UK saw no GDP growth from July to September and, with the logistics sector often signalling what is to come for the wider economy, it is deeply concerning that activity in our industry is slowing, with fewer goods being moved as the cost-of-living crisis bites.
“At the same time, insolvencies across the sector are up more than 8% compared with a year ago, and employment figures are falling for the same period as demand slows, (by 13.6% for HGV drivers).”
“Internationally, the cost of shipping containers is the lowest it has been for three years, indicating a lack of demand.
“And this is all at a time when crude oil prices, which are linked intrinsic to the price of diesel – on which our sector relies – are forecast to remain historically high at around $95 per barrel throughout 2024, placing further inflationary pressure on logistics operations.”
As Mr Wells continues, the industry has some key asks to help logistics businesses continue to operate effectively and weather the pressures on the economy.
“To keep goods moving, and logistics businesses growing, our industry needs to see financial measures in the Autumn Statement that back business investment,” urges Mr Wells.
“We are urging the Chancellor to make the current full expensing allowance for capital spending (due to expire in March 2026) permanent to enable effective succession and expansion planning.
“This should include the cost of acquiring leased or hired vehicles, as well as those purchased outright, and the cost of installing the infrastructure required to help the industry decarbonise.
“Without support in the Autumn Statement, the logistics sector will continue to battle rising costs and business pressures that will stifle growth and slow the economy still further.
“We urge the Chancellor to help our member businesses to keep Britain trading and reverse the current slump our industry is experiencing.”
Published On: 16/11/2023 16:00:00
If you are a Logistics UK member login to add comments.
Peel Ports and Suardiaz launch UK-first green automotive hub in Merseyside
A UK-first green automotive manufacturing hub, which will significantly reduce supply chain emissions in the North West, has been launched in Merseyside this week by Peel Ports and Suardiaz.
The £10 million facility – located on a 9.5-acre site at Queen Elizabeth II Dock at Eastham, within Peel Ports’ Mersey cluster – will power sustainable vehicle manufacturing and facilitate a greener end-to-end maritime logistics service in the North West.
The maritime route servicing the plant is projected to reduce annual CO2 emissions by 30% and energy consumption by 37%, when compared to road travel. It is expected to take an estimated 14,700 lorry journeys off roads across the UK and continental Europe annually, saving approximately 17.5 million kilometres (c.11 million miles) in road trips.
"This new Green Automotive Hub is a great example of the forward-thinking cooperation that is needed to reduce the impact of the maritime and logistics sectors on the environment,” said Claudio Veritiero, CEO at Peel Ports.
“We have consistently said that reducing road miles will be central to combating climate change, but we know that can only be achieved by providing sustainable alternatives utilising ports in close proximity to final destinations.”
Building a resilient FORS Community for the road ahead
FORS – the Fleet Operator Recognition Scheme – recently welcomed its largest-ever delegation to the sixth FORS Annual Conference at the International Convention Centre in Birmingham.
Read time: 2 minutes
Cruising altitude: the rise of air cargo in UK trade
Transporting goods internationally in fast and efficient operations is paramount for logistics businesses to remain competitive in the 21st century.
Read time: 2 minutes
Ask the MAC - November 2023
Every month we get a variety of questions and every month our intrepid Member Advice Centre has the answers.
Read time: 2 minutes