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Northern Ireland logistics 'cannot be sustained' with coronavirus losses escalating

Call to help firms survive and continue deliveries

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Stephen Farry is calling for more action

Stephen Farry is calling for more action

PRU/AFP via Getty Images

Crucial logistics firms here are facing massive operating losses of up to £150,000 a week (stock photo)

Crucial logistics firms here are facing massive operating losses of up to £150,000 a week (stock photo)

Alex Dodd

Stephen Farry is calling for more action

Crucial logistics firms here are facing massive operating losses of up to £150,000 a week, with dozens facing an uncertain future, Business Telegraph can reveal.

While some companies are seeing business soar to levels of demand associated with Christmas such as those involved in meat and poultry, others which deliver for firms such as fashion retailers have seen trade plummet as the UK-wide lockdown hits business.

Businesses which deliver to Northern Ireland but rely on bringing goods such as returns back to Britain and elsewhere are now "running on empty", but facing the same costs and overheads.

For some there has been a 90% drop in business, and unsustainable trading imbalances.

A document seen by the Belfast Telegraph, sent to the Economy Minister, is calling on immediate action: "… many NI transport operators are trying to balance keeping the supply lines open as an absolute priority while limiting the severe losses incurred to try to buy time until the Government delivers an emergency support package," it says.

"Operators are conscious that once those supply chains break down, they may be gone forever as NI exporters may struggle to win back that business again."

Many are working at a loss, with some losing as much as £150,000 a week. It's understood one operator shipped 140 empty lorries across the Irish Sea last month at a cost of around £56,000 for transport alone.

“It is imperative that government assist transport operators involved in essential supply chains otherwise industry will continue to bear all of the financial pressures alone and without intervention. This can only last for a matter of weeks before those supply chains begin to break up with economic and social consequences,” the letter says.

Some transport providers involved in non-food sectors such as motoring, construction, engineering and clothing have seen volumes drop considerably in recent days, with one business seeing 90% of its normal volume disappear due to business closures.

Now, Alliance MP for North Down Stephen Farry has written to the minister calling on action to “do all we can to make sure that essential products and food are still readily available and that supply is secure”. In a letter to the minister, he says: “It is in that spirit that I ask you to outline your plans to ensure security of supply of food and consumer products if there should continue to be significant and urgent challenges to the logistics sector which has the potential to see some hauliers leave the market due to financial constraints.”

The Freight Transport Association represents 18,000 members across the UK, with 400 of those based here.

The organisation has also said many firms are suffering severe cash flow issues as debtors are not paying on time.

Some have received letters from businesses that have closed for the period, stating that no payments will be made to creditors until they resume “normal working patterns”.

The industry is calling for measures to be introduced in a bid to bolster the sector here, including deferring VAT payments for the end of 2019 and 2020, guaranteeing 80% of driver wages who currently remain in employment and the refund of road tax for 12 months.

“Those who cannot subsidise these costs are now choosing to temporarily close their businesses, furlough workers, park up and SORN (Statutory Off Road Notification) their vehicles, which is a cost to government while leaving industry with less choice of transport providers,” the letter sent to Economy Minister Diane Dodds says.

“It is imperative that government assist transport operators involved in essential supply chains otherwise industry will continue to bear all of the financial pressures alone, and without intervention this can only last for a matter of weeks before those supply chains begin to break up with economic and social consequences.

Belfast Telegraph