Thursday 4 July 2019 12:01 am

Logistics sector optimism hits record lows over Brexit fears

Optimism in the logistics sector has plummeted to record lows as the industry battles Brexit fears.

According to the Logistics Confidence Index compiled by Barclays and BDO, the industry has reported net pessimism for the first time since records began in 2012.

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The index showed an overall reading of 49.7, dipping below the 50 mark, which indicates that the sector is more pessimistic than optimistic about the state of the market. 

Increasingly challenging business conditions drove the drop in confidence, with many respondents to the survey citing Brexit concerns as a major issue.

Plans for the future are being delayed by Brexit uncertainty, with 47 per cent of businesses making lower levels of investment or delaying decisions since the 2016 referendum.

Firms have ramped up their Brexit preparation planning, as five per cent said they had taken no action compared to 10 per cent in the previous survey. 

Richard Smith, head of transport and logistics at Barclays Corporate Banking, said: “Our logistics operators are sending a clear message – a no deal Brexit is going to hurt the industry and must be avoided.

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“The business leaders we surveyed have combined revenues of £17.2bn, so the fall in confidence they are reporting should be taken seriously.

“We don’t need to panic – the industry is extremely resilient and the index’s dip into negative territory is marginal and comes after a long run of optimistic results. Logistics provider are doing their bit by investing in new technology and sustainability projects, but are dependent on the external environment being trade friendly to help them achieve growth and make a positive contribution to the UK economy.”