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Assessing the technologies that are changing freight movement

Delivery drones are but one technology that is poised to radically disrupt the supply chain.

The freight industry is in the middle of a storm, with technology giving conventional processes a makeover and making it more efficient and transparent to the players in the market. Cutting-edge technological ideas have been mushrooming in the freight hauling space, with major corporations and startups tussling for a share in the market.

The freight economy is one of the largest markets in the United States, with over $700 billion in revenue every year and employing 8.7 million people in the industry. This provides an incentive for companies to cash in and it was inevitable that technology would be adapted to fit the market needs.

And here we stand at the crossroads of innovation, with the impact of technology felt in different micro-niches in the industry – as we try shining some light on the niches with considerable potential, looking to change the facade of freight hauling forever.

Autonomous Freight Hauling

Running machine-learning models on the road has been of perennial interest to auto manufacturers around the world, and the race is tightening its screws on long-haul freight trucks, with autonomous driving being the market’s niche vertical.

One of the underlying reasons for the trucking industry to look at autonomous hauling is the inherent difficulty the market is facing in recruiting new drivers and even in retaining the existing ones. Obtaining an interstate CDL license is not possible until a person hits 21, forcing a lot of aspiring young drivers to look at different paths after high school.  

The lopsided equation on the supply and demand of truckers essentially drives up labor costs which escalates friction on the economics front – with one-third of the hauling costs being accounted for by the driving community.

But with Silicon Valley’s fascination towards AI and on big data collected from millions of miles of truck transits, it is possible to supplement drivers with intelligent bots. Decacorn companies like Google, Uber, Daimler, and Volvo are actively working and investing in the autonomous driving niche.

Though obtaining licenses to run a complete end-to-end 360-degree automated freight hauling service is still not in the foreseeable future, assistive decision-making algorithms are here to stay. For example, Otto’s cruising mode can take some steam off drivers while on the road, with trucks having the ability to drive themselves for hours without intervention. The idea of platooning where trucks are made to trail behind each other to reduce fuel consumption is going a long way in making the industry more resource efficient.

Electric auto-giant Tesla is working on furthering the pursuit of an energy-efficient and a greener future through its electric self-driving trucks. Tesla is currently developing its prototype and plans to create a fleet of trucks that can platoon themselves on transit. The company argues that techniques like these reduce drag and power consumption considerably during long-haul interstate freight hauls since trucks have the liberty to travel at uniform speeds and against minimal traffic.

Tesla’s research on increasing battery capacity could go a long way in ushering in a new-age of electric freight transport. Morgan Stanley predicts that with all the freight intelligence and assistive technology, the cost of operating an electric truck could be 70% cheaper than a diesel-powered truck, making it a fascinating prospect.

The autonomous driving technology, albeit with exciting potential, is not devoid of some apprehension. Safety of freight trucks on the road is a never-ending concern to the general public, since in the event of an accident it becomes difficult to assign responsibility. Nonetheless, with technology, persistence is crucial, and with improved models and a lot more data analysis, we should hope to see the light at the end of the tunnel.

Blockchain for the Truck Industry

Blockchain technology burst into prominence with the advent of Bitcoin a few years ago, and there has been no looking back since. Storing information in blocks across a shared digital network makes the system incorruptible and thus paves the way for safely encrypted transactions, shipment tracking, and fleet management across the freight industry.

Blockchain’s potential when coupled with the might of the trucking industry implies that it can tackle the most significant challenges in logistics and fleet management, bringing in a more efficient and transparent process.

The Blockchain in Trucking Alliance (BiTA), is a coalition looking to lobby for an extensive adoption of blockchain in the industry. The organization is seeking to improve the conditions for all the players in the market – through instant payment upon delivery, record maintenance, and setting up a framework for tackling disputes over quality claims and safety issues.  

Since announcing the formation of the Alliance in August, the organization has received more than 200 corporate applications to join, with 85% of the trucking transactions accounted for in the group by at least one member institution.

Though the technology is sound, problems arise with the feasibility of market penetration. The conventional freight industry has been conservative and slow on adopting new practices, which makes it necessary for industry leaders to create a conducive environment for the trucking fraternity to learn about blockchain.

“By using blockchain, the industry can reinvent the very nature of a commercial activity,” says Craig Fuller, the co-founder of BiTA. “They can provide real-time settlement, tracking, and chain of custody without fraud and ownership by a single party.”

Blockchain is about digitizing an industry that has been in the shackles of manual logs, paperwork, and physical transactions, and is the silver bullet to sustaining growth in the freight market. Finding investors is a cause for concern because of the skepticism in adoption rates, but there has been significant progress over the last year, with the community waking up to the idea of blockchain.

Hyperloop Technology

The Hyperloop project has been creating waves in the transportation industry for over a year, primarily because of its affiliation to Elon Musk. Looking at a skeletal model of hyperloop after removing all the technical jargon tells us this – it is a highly pressurized tube that can push freight at about 700 miles an hour, which makes it one of the most ambitious projects of our time.

Though the idea sounds captivating, adopting hyperloop into mainstream freight hauling might take at least a decade to materialize, due to the extent of infrastructure that needs to be constructed on the ground. Micro-level experimentation of the hyperloop tube is already underway, with it having a fair share of critics, who have been divided between elation and a lukewarm response towards its progress.

Backers of hyperloop programs advocate that its realization would make it the most fuel-efficient means of transportation, but the expenses incurred in building the infrastructure might still keep it quite out of reach to an average shipper. The way forward is to make sure the government takes interest in this and foots the bill, along with private investors looking to share the risks of such a mega-construction project.

Incidentally, the Virgin group has joined hands with Hyperloop One, bringing in a sizable amount of finance with it. This could help in bringing the system from being on paper to being realized on the ground.

But then again, hyperloop for freight might still need some viability analysis because of the constraints it poses on both the technical and business fronts. Mathematician Alon Levy argues that heavy freight that is currently being transported by rail would not be feasible for the hyperloop because the lateral force it generates on curves would overstress the system’s proposed light elevated pylons.

That being said, hyperloop does have a role to play in connecting cities of the future, and should consequently work on freight supply chains. Until then, the world needs to make do with High-Speed Rail (HSR) networks that a lot of Asian and European governments have invested in and find to be economically viable as well.

Cargo Drones for Freight Transport

Drones have been around for quite some time now, with them being widely used in photography, monitoring, and search & rescue operations. But with companies like Amazon and UPS investing heavily on drone fleets for cargo delivery, the idea has taken a new meaning for freight transportation.

Over the last year, Amazon has commenced drone delivery trials in the United Kingdom for its Prime Air feature, through which customers get their items delivered straight to their houses with the help of drones.

Cargo drones open up an entirely new line of work, with companies needing drone operators who are experienced with unmanned flight testing to control the delivery drones. With the technology that is present now, it is far-fetched to think about heavy hauling through drones in the near future, but one can surely anticipate weightless house items to be delivered through such services.

Amazon is extremely motivated by the idea of cargo drones, especially because it shaves off a considerable amount on the delivery times. The e-commerce giant has recently patented a futuristic drone delivery center that resembles a beehive, with drones flying in and out of the landing pads across the facility.

Natilus, an aerospace drone startup working on hauling larger loads through the air, is confident of reducing air freight costs by half to that of a Boeing 747. The drones that the startup develops can work outside of FAA airspace certification, which in essence means that regulations are not an issue, drastically reducing haul rates.

Though the freight industry has been sluggish in adapting to change, it is vital to adopt technology to sustain the exploding growth. With commerce across the U.S. border at an all-time high, it is these technological advancements that can help the industry propel itself to considerable heights in the future.

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Vishnu Rajamanickam, Staff Writer

Vishnu writes editorial commentary on cutting-edge technology within the freight industry, profiles startups, and brings in perspective from industry frontrunners and thought leaders in the freight space. In his spare time, he writes neo-noir poetry, blogs about travel & living, and loves to debate about international politics. He hopes to settle down in a village and grow his own food at some point in time. But for now, he is happy to live with his wife in the middle of a German metropolitan.