What Is Cabotage And Why Does It Matter?

This month, we thought we would use our blog post to give a summary on the UK Government’s changes to the Cabotage rules, the effects they had on the courier industry, and why many in the industry were unhappy with the situation.

Cabotage is the practice of foreign trucks/drivers carrying out domestic deliveries whilst in the UK. More specifically, it refers to loads these drivers pick up AND deliver in the UK.

Since Brexit, cabotage has been restricted, with foreign companies only allowed to pick up and drop off two loads in a 7 day period in the UK. These deliveries have typically accounted for only 1-2% of HGVs on our roads according to a study by Transport Intelligence. The reason for the restrictions has generally been to protect our industry given that many foreign delivery companies are able to offer reduced rates compared to UK companies.

Over the last two years, however, there has been an unprecedented shortage of delivery drivers in the UK. The main reason for this is the increasingly bad pay and working conditions that drivers face, feeling that they do not get what they deserve for the crucial job they do. This has led to a much lower number of people applying for jobs, and ultimately the supply chains for many industries started to feel these effects.

As a response to the supply chain shortages, in October last year, the UK government announced an easing of cabotage rules that allowed foreign drivers to make unlimited deliveries over a two week period. The aim was to provide a short term solution to the shortage of drivers, with the rules being reinstated in full once the UK haulage industry could handle domestic demands on its own. The cabotage easing was extended and has only just ended on the 30th of April.

Many in the industry were unhappy with this extension and saw this as a short-sighted solution that undermined the UK haulage industry in the long run. They claimed that as they face rising wages and costs as well as an ongoing shortage of drivers, extending these rules just took more business away from them and into the hands of foreign drivers right when they needed it most. Although many are happy the relaxation has ended, the government has not done away with it completely, and the measure could be reintroduced if need be to boost the road transport capacity in the UK.

For now, the industry is being allowed to build itself back up without help from foreign drivers, but we will have to wait and see whether the government feels the need to reintroduce measures if shortages become an issue again.