The UK’s controversial backdated ports rates proposal may force logistics provider CAT (UK) to withdraw activity from Teeside as it faces a £500,000 bill for its 50-acre storage site at the port.
CAT (UK) is the only importer of Renault cars to the UK and makes final inspection and fittings to imported models at its facility in the northeastern port, known as Teesport. However, the company, which already pays port rates for its value-added facilities, is now being faced with the additional charge and is pursuing an appeals process in response.
Should this fail the company would be forced to consider a move back to the Port of Le Havre from where the cars are shipped, in order to avoid costs that Renault has said it will not absorb. Such a move could put 84 jobs in jeopardy and threaten local contractors.
CAT (UK)’s Managing Director Stuart Warren said he was disappointed that PD Ports, which will gain a £7m rebate from the rates proposal, had not come to an agreement about the charge since the land to which it applied was not for CAT’s exclusive use but a temporary storage area which it regarded as “general port processes”.
Companies around the UK are facing bills for backdated business rates that do not take account of rates payments they have already made to port operators.
“This double-taxing of storage land in Teesport and in UK ports generally will make it even more attractive to locate value-added services as well as storage in the nearby continental ports,” Warren told Automotive Logistics. “Although we have no definitive plan for doing so yet, and our customers enjoy the flexibility of UK based operations, I can see a time not so far away when it would be no longer economic to continue this."
According to Renault spokesman Jeremy Townsend: “There are no plans to change the existing arrangement of importing cars to Teesport.”
The new charges are being proposed because the UK government has changed the way business rates are collected on the docks. BMW, GM, Honda and Volvo have all raised concerns about the charges.