Cabotage is an old term. John Cabot was a Venetian who ‘discovered’ North America for Henry VII, almost instantly triggering laws to govern who was allowed to ship what in which country’s vessels. Currently in European road transport, cabotage refers to the rights for a truck from one country, having delivered its load to another, to ‘tout for business’ in that country before returning home. ‘Haulage of goods for hire or reward in one member state in a vehicle registered in a different member state’.
On the one hand, cabotage is good. It can improve transport operator profitability, lower costs to shippers, reduce empty running and environmental impacts. On the other hand, cabotage enables carriers from other countries to take work that domestic carriers are vying for.
Since 2010, EU trucks have been allowed to undertake three ‘cabotages’ in a period of seven days in their country of destination before returning home. Importantly though, these ‘cabotages’ have to be essentially casual – not part of a regular contract.
In fact, the competition from cabotage, whether you regard it as fair or unfair, may be about to ramp up. The EU’s ‘Europe on the Move’ initiatives propose an unlimited number of cabotage trips. Albeit only within five days, rather than seven, of arrival in the host country.)
Now, this is aimed at better regulation rather than liberalisation, but the fact remains. It means more domestic work can and will, without more opportunity or advantage for domestic carriers, go to non-domestic carriers.
How do you compete?
Firms looking to compete with legal ‘cabotage’ trips, effective freight matching such as that of TGMatrix, are essential for finding the best loads at the optimal price. With many cabotage opportunities within the UK soon to be available to visiting vehicles, UK carrier and shippers need to act.
If our own carriers feel they are losing out, or if your shippers have reservations about employing foreign carriers, they should be more active users of UK freight matching services.
This change is unlikely to occur before Brexit. As to what any UK/EU rules on cabotage will be thereafter, who knows? Of the EEA states, Norway has rules in line with those of the EU, while Switzerland largely bans cabotage. Disallowing cabotage would work against the ‘green’ transport agendas in the EU and UK, so some agreement is likely. But carriers who want their ‘fair’ share of the business, at home or abroad, should be getting on board freight matching now.
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