Commentary: Focus on the controllable, not driverless vehicles

The era of autonomous trucking is surely coming, but it’s more important for brokers and shippers to get a handle on data than worrying about what the distant future looks like.    In early November, the veteran auto industry executive Bob Lutz penned a shockwave-inducing editorial for Automotive News that urged people to quickly embrace the reality of autonomous vehicles.
   The headline of his piece screamed that existing car owners will have years to offload their vehicles “or sell them for scrap.”
   Other highlights:
     • “Human-driven vehicles will be legislated off the highways;”
     • “The era of the human-driven automobile, its repair facilities, its dealerships, the media surrounding it – all will be gone in 20 years;”
     • And “The tipping point will come when 20 to 30 percent of vehicles are fully autonomous. Countries will look at the accident statistics and figure out that human drivers are causing 99.9 percent of the accidents.”
   I don’t disagree with any of these points. One can quibble with the timelines suggested by Lutz, a veteran of General Motors, Ford, Chrysler, BMW and Opel. But the underlying premise is right. Autonomous transportation is on its way, whether we like it or not.
   However, I’m going to suggest a contrary view of how to manage this change when it comes to logistics and freight transportation. Don’t worry about it.
   As with most headlining-grabbing topics, our robot-driven future (literally “driven,” in this case) tends to create a certain amount of anxiety. There’s the fear of whether such autonomous technology is safe, how it will displace workers, and what it means to the fabric of society. Those are the cultural fears.
   I’m guessing that supply chain practitioners are starting to now really wrestle with how autonomous vehicles might change their work lives. I’m also guessing most of those plans are largely theoretical, since there’s no actual autonomous vehicles actually in the market yet (beyond some pilots that wouldn’t move the needle on capacity anyway).
   I’d never suggest that companies not start planning for imminent future developments – in fact, most companies get caught playing catch up when major technological advancements occur.
   But there’s still a very long way from here to there when it comes to acceptance of autonomous vehicles, and there are pressing issues to contend with right now. Over the road freight rates are sky high (December spot rates were up 86 percent over the same month in 2016, according to DAT), the electronic logging device mandate has gone into effect (cutting workable hours for drivers), and driver retention remains a system problem.
   And in the meantime, software companies and freight brokerages large and small are providing actual technology solutions that can help shippers and 3PLs manage the near-term challenges of trucking right now.
   For instance, last week, Chicago-based Logistics Labs briefed me on their truckload and intermodal analytics tools. The company’s platform is meant to arm brokers and intermodal providers with a way to juice up their existing systems.
   It’s not a replacement for a transportation management system (TMS) or freight procurement system, it’s meant to allow companies to let those systems make better rate comparisons and decisions based on their historical data and index data.
   What I found really intriguing was the way the platform, called LoadDex, helps to normalize decision-making among the most and least experienced personnel at a broker. There’s so much turnover in the brokerage industry that a key inefficiency is the lack of institutional knowledge a new employee might have.
   That new hire might simply not know what a good rate is until she or he has the requisite reps to know that carrier X is reliable and thus should command a premium, or that shipper Y will pay more for that premium. The analytics provided by LoadDex help that new hire make more informed decisions by providing instant historical and indexed rate information in lieu of that neophyte polling colleagues by voice or email to figure out if a rate is good.
   These types of technologies are what the industry should be focusing on, not the shiny metal of Tesla’s new autonomous big rig. When those autonomous trucks do come into service, when that tipping point that Lutz spoke of occurs, it’s the companies that are proficient in their use of data that will reap the biggest benefits.
   In other words, when autonomous trucks are the norm, there will likely be baseline benefits to every mover of freight. Higher safety rates, more capacity (since robots never tire or want to return to their house each night), and more algorithmic efficiency to unlock triangulated moves.
   But the fundamental economics of the market won’t change. Demand and supply will impact price and availability, and the ability to know a good rate will still matter.
   So heed what Lutz is predicting, but spend the next few years aiming to build analytical foundations for that autonomous future, not worrying about what the physical world of driverless vehicles actually looks like.