What Uber-style Transportation Networking Has Done To Taxis, Is Soon To Be Replicated For Trucks
“In the US, over 70 percent of all freight movement fueling its economic engine is hauled by trucks of various types and sizes. Needless to say, any improvements in freight efficiencies will have a cascading positive impact on all corners of the world’s largest and most dynamic economy. The last time the US transportation and logistics industry experienced revolutionary changes was in the 1990s, when IT induced remarkable efficiency gains. We are now at the cusp of a similar revolutionary transition in the trucking industry with Uber for truck-type apps entering the market, but this time the competition will be high and the solutions a lot more fragmented.
“Picture this: a bearings maker in San Francisco needs to urgently ship 20 boxes of bearings to an elevator manufacturer in Seattle. An “Uber”-type app for freight transportation can now connect the shipper to a truck that is scheduled to leave the shipper’s area for Seattle. The driver is happy, as she/he can now get more payload to carry (which otherwise could not have been located on an on-the-fly, ad-hoc basis), gain revenues, and reduce empty miles. The shipper is happy because he/she can ship freight on an ad-hoc, on-demand basis. The app provider is happy as it has created a new business opportunity in the market helping efficiently connect demand to supply, and finally other motorists and the environment are both happy as we reduced empty miles (hence congestion) and also emissions. Moreover, shippers are billed immediately and carriers are paid immediately, and the transaction is executed in a swift and seamless manner with the app provider benefiting from each transaction. Each year, on average, 20 billion empty miles are incurred by trucks, which cost the economy billions of dollars in fuel, congestion, environmental damage, and lost man hours.
“The North American trucking industry is facing an acute driver shortage, which by some estimates stands at a deficit of 400,000 drivers. An even more disturbing trend is the record-low levels of young drivers (21-25 year olds) in the overall driver population mix. These challenges can deal a serious blow to our economic growth if not addressed immediately. Smartphone-based freight brokering, among many other innovations, can help reduce the severity of this shortage; when coupled with autonomous driving, truck connectivity and infotainment, and cabin comfort and convenience-focused enhancements brought by truck makers, it can also attract younger drivers.”