The issue of transportation is a key theme of Brexit, with hypothetical channel tunnel queues proving a planning headache. British rail industry group RDG suggested that inland rail terminals should service freight deliveries post-Brexit, proposing a rise on the rail industry’s 5% freight share. This is indicative of the creative thinking employed by the transportation industry to counter the biggest logistical challenge in a generation.
With wide scale changes likely to maintain the smooth running of imports and exports, various aspects of the transportation sector stand to benefit. Private businesses are already weighing up the opportunity at the first point of call, the transport itself. However, it may well transpire that stakeholders from across the economy will benefit from any changes – starting with the insurance and finance sector.
Improving safety through options
Moving away from a lorry-based system of import and export and towards rail and air will help to reduce liability on the roads. According to the most recently updated ONS figures, large vehicle road deaths are up 6.1% compared to the previous year. Unsurprisingly, this has coincided with a greater level of liability claims being made by employers and members of the public. This is being put down to the increased driving times permitted by lorry drivers, and the increased motorway speed limit. However, regulation and behaviour alone is not responsible for this trend; a DVSA study found that 10% of all HGVs have urgent driving defects, and 28% overall have any other type of problem. Product liability problems pose the issue of legal liability for employers – a case tried in Truro criticised the employer for a death caused by a faulty vehicle.
Accordingly, moving away from road-based haulage and into alternative methods could benefit insurance firms. It may well provide a positive uplift for both employers and insurers. Insurance finance markets, of which premium finance takes up a £10bn slot in the UK economy, will enjoy the lessened level of liability.
Developing the business reputation of rail
If the suggestion that haulage should come through rail terminals goes ahead, it may well provide some of the country’s embattled rail providers an opportunity to develop their business reputation. The UK rail system is already heavily bidded by EU companies and Brexit may provide the opportunity for UK rail franchises to repeat their business abroad.
Journeys taken domestically by UK railways are falling, with The Guardian reporting that 2017 was the first year in which business and recreational trips had declined since the late 2000s. With four franchises looking further afield for business success, becoming involved in the proposed freight management changes could prove lucrative. Again, this will have a positive knock on effect on the private construction industry and venture capitalism looking to stake their claim on any developments. Further into the future, any positive business nous created by the proper management of a freight system would put companies in good stead for foreign franchise bidding or other overseas development.
The transport problems posed by Brexit are a headache but present opportunity in their wake. If the methods of old are to be discarded and rail and air looked towards to provide logistical function, there are many industries that can stand to benefit. Not just within the transport sector itself.