Significant progress in the logistics industry is observed in areas such as the application of artificial intelligence, analytics and automation, etc. These technologies are developing faster than ever, and startups with the latest solutions and innovations continue to appear at a great speed. These innovations are associated with new expectations and high standards, forcing logistics companies to either adapt or fall behind the competition. In addition, there is a lot of pressure on carriers from customers who want to get goods or services faster and cheaper than ever before.
But the breakthrough in technology is not the only major change affecting the industry. New shipping rules, rising global tensions and global trade wars, and a predicted economic downturn are all things to consider for logistics companies in 2020. For example, carriers are already working hard to comply with new international directives limiting the sulfur content of ship fuel to 0.5%, which came into force on January 1, 2020. The International Maritime Organization (IMO) estimates that the new standard will affect up to 70,000 ships and could lead to a 20-30% increase in overall fuel costs, and these costs will ultimately fall on the shoulders of consumers.
Global trade wars, in particular the trade war between China and the United States, continue to affect logistics operations. In 2018, trade tariffs affected $34 billion worth of Chinese products imported into the US, and China took costly countermeasures on US imports. The European economy is also in a downturn as Brexit concerns continue to weigh heavily on European countries and the US economy is also struggling. All this points to a possible global recession in 2020, which will make life difficult for logistics companies.
The top 10 most important logistics technology trends in 2020 according to Transmetrics are:
Artificial Intelligence (AI) and Intelligence Amplification (AI)
Over the past few years, the logistics industry has been integrating artificial intelligence solutions into its operations, including intelligent transportation, route planning and demand planning – and this is just the beginning. From cutting-edge courier robots and resilience solutions to automated warehouse systems and predictive optimization software, AI is already widely used by advanced carriers. Shippers, carriers, suppliers and consumers can count on the positive dynamics of the use of these trendy logistics technologies, which will continue to be on the crest of success in 2020.
Along with artificial intelligence, AI technologies (intelligence amplification) are increasingly expanding their niche. AI combines human intelligence with automated AI processes. In logistics planning, the use of MI is becoming more and more popular, as it can combine the use of data from specialists (who have extensive experience, responsibility, flexibility in decision making, common sense, etc.) with AI technology, which will allow personnel to easily perform repetitive and tedious work. Logistics companies will implement more and more IM scheduling solutions that will ultimately enable logistics professionals to do their job more efficiently.
Digital twins
Digital twins are one of the most exciting current trends in logistics technology. They are worth keeping an eye on in 2020 with special attention. As many logistics professionals know, computer models will never match the products exactly. Modeling in its current state does not take into account how parts wear out, how fatigue builds up in structures, or how owners make changes to meet new needs. However, digital twin technology changes everything once and for all: now the physical and digital worlds can be combined into one, which allows a person for the first time to interact with a digital model of a physical object or part of it in the same way as with their physical counterparts.
The potential for digital twins in logistics is enormous. In the shipping sector, digital twins can be used to collect product and packaging data to identify potential gaps and trends. Warehouses and businesses can also use this technology to create accurate 3D models of their centers and experiment with layout changes or new equipment to evaluate the impact of such changes without risk. Logistics centers can create digital twins and use them to test different scenarios and improve operational efficiency. In addition, delivery networks can use this technology to provide real-time information that will improve delivery times and affect the efficiency of autonomous vehicles.
Real-time supply chain visibility
Supply chain visibility (SCV) is no longer just an unusual novelty for logistics companies; in 2019, for many, this technology has become indispensable. In 2020, many carriers need to take another step forward by making SCV technology available in real time. Real-time data is increasingly in demand by customers and carriers, which means that logistics companies must focus on implementing advanced SCV solutions. New start-ups that provide supply chain visibility provide technology that makes it possible to respond to all changes in real time with lightning speed. Such data includes traffic patterns, weather conditions, or the condition of roads and ports. Data is used to take action and decisions, change demand or redirect supply, and optimize routes. Logistics companies that use fully integrated supply chains are 20% more efficient.
You can’t talk about supply chain visibility without mentioning Internet-based equipment monitoring or Internet of Things (IoT) technology, which is a critical tool for tracking shipments. Connected IoT devices allow warehouses to track inventory, vehicles and equipment through cloud services. At the same time, IoT-based container management is simplified through real-time monitoring, fuel savings, preventive maintenance, and more. Thus, partnerships between IoT technology startups and logistics companies are another important trend to look out for. special attention in 2020. A recent example is Hapag-Lloyd, which has chosen IoT startup Globe Tracker for its new Hapag-Lloyd Live container monitoring system.
Blockchain
Since its inception in 2008, blockchain technology has grown into one of the hottest concepts in any industry, as well as one of the most overrated logistics technology trends. However, the complex concept of blockchain technology has been difficult for the general public to understand, and despite its great potential for use both inside and outside the logistics industry, overall the technology has not found mass adoption. Nevertheless, pilot projects and small start-ups exist and are successfully operating. CargoX is one of the startups that is fully dedicated to the development of blockchain technology in the logistics industry using the Ethereum network to securely verify document transactions. Many well-known companies are also showing interest in blockchain: Warren Buffett’s UPS and BNSF Railway have joined the Blockchain in Transport Alliance (BiTA), the world’s largest commercial blockchain alliance with 500 companies in more than 25 countries.
In the logistics industry, blockchain will help simplify the exchange of sensitive data for different carriers or shippers. Companies can build trade and supply chain finance solutions, such as Maersk and IBM’s blockchain joint venture called TradeLens. Currently, five of the six largest carriers in the world have joined the platform, and more than half of the world’s container shipping is carried out through the TradeLens system.
Logistics companies must digitize, standardize data, clean data. After implementing an industry-wide standard, companies must form an ecosystem of supply chain partners to use the standard in a common blockchain environment. In the future, thanks to TradeLens, the logistics industry will be able to use the full potential of this technology.
Data standardization and advanced analytics
Traditionally, logistics data has always been isolated. Companies store data in any place convenient for them, which leads to the creation of fragmented systems, inefficiencies in their use and difficulties in digitizing operations. One of the most important trends in logistics technology in 2020 suggests that data warehouses will no longer be the place for companies that want to keep up with the times. For example, new data standards are already being created in container shipping, thanks to the emergence of the Digital Container Shipping Association (DCSA) in 2019. DCSA’s mission is to create common information technology standards for data digitization and interaction to make the delivery sector more efficient for both customers and shipping lines. Just a few months after its inception, the organization released its first draft detailing new industry standards for data processing processes used in container shipping.
The DCSA represents only the data standardization movement in the container shipping sector and it will take time for the association to develop new standards covering the various shipping sub-sectors. Meanwhile, Traxens, an IoT company providing data and services to the supply chain industry, announced that it has led the development of the first standards for smart container exchange published by the United Nations Center for Trade Facilitation and Electronic Business to facilitate the use of smart data. container.
In other areas of logistics, the search for solutions to the problem of data inconsistency is still relevant, leading many young startups to focus on building predictive and advanced analytics platforms. These logistics startups are helping large companies clean up and digitize data, allowing that data to be used for advanced analytics and predictive optimization. Including supply chain visibility, demand forecasting, liner planning, contingency detection, and improving last mile logistics conditions. When data is standardized and digitized across the entire logistics industry, all companies in the industry will benefit.
The growing role of newcomers in the industry
Not only new technologies are shaping the future of logistics. Equally important are new business models and new industry players. New systems, built with the active assistance of start-ups and incorporating elements of the sharing economy, are rapidly gaining popularity.
In 2017, Uber launched Uber Freight in the US. In 2019, it expanded its presence in Europe and Canada, aiming to create a more efficient global freight market. Uber Freight, according to Uber, is one of the most promising ventures: during an investor meeting in August 2019, Uber CEO Dara Khosrowshahi stated that Uber Freight continues to show impressive growth and significant progress in the second quarter.
Even industry customers see potential in freight forwarding, with Amazon looking to expand its warehousing and transportation expertise to develop its own shipping capabilities. The company has already made great strides with the development of Prime Air, a drone service it is building to build all-electric drones that can fly up to 15 miles and deliver sub-five-pound packages to customers in less than 30 minutes. Moreover, the company is reported to be importing new Amazon-branded intermodal containers from China. In addition, the company announced the creation of the Amazon Flex platform, which will attract contract drivers when necessary, to accelerate the expansion of the Prime One Day delivery program.
Amazon also announced its new Pegasus robotic systems, which will be deployed to hundreds of customer service centers around the world. These robots are designed to sort and move individual packages. The new Pegasus devices help reduce sorting errors, reduce product damage and speed up delivery times. Pegasus robots have traveled two million miles to date and have already reduced missorted goods by 50%. The company is also testing Amazon Scout, which is designed to securely deliver packages to customers using small, autonomous delivery vehicles. To complete all of its latest developments, Amazon CEO Jeff Bezos announced that he has placed an order for 100,000 delivery vans with Rivian, a new Michigan-based electric vehicle manufacturer. The first vans will hit the road in 2021, and prototypes could be ready as early as 2020. Rivian will receive an investment of US$700 million.
Another prime example of the company’s impact on the industry is Flexport, a licensed global freight forwarder and customs broker powered by specialized cloud software and analytics platform. The company received $1 billion in funding earlier this year and plans to launch the Global Trade Operating System, a strategic global freight forwarding operating model that integrates the best of technology and all elements of the supply chain.
Growth of investments in logistics start-ups by venture companies
In 2019, venture capital companies invested a lot in promising logistics startups, so such investments have become one of the most important logistics technology trends this year. Worth mentioning is Flexport’s $1 billion investment. KeepTruckin, a San Francisco, California-based fleet management company that connects trucks worldwide, has received $149 million in funding. FLEXE, a leader in on-demand warehousing, has raised $43 million in funding.
As VC investment in logistics startups grows, large logistics companies are beginning to follow this path as well. Many of them have invested millions of dollars in new technologies developed by innovative start-ups or have acquired them. In this way, logistics companies can get the best result: use their capabilities by conducting research and development with the help of their new partners. Giants like UPS see great benefits in partnership: In early 2019, UPS made an investment in TuSimple, an autonomous vehicle company, to test self-driving vehicles in Arizona and assess their potential for the company. Maersk also recently announced that it is joining other shipping giants CMA CGM and MSC in investing in Traxens, an IoT, valuable data and services platform for the supply chain industry. The e-commerce world is looking to get in on the race, with shopping platform Shopify acquiring 6 River Systems, a warehouse robotic solution provider.
The race for innovation has also prompted Singaporean sovereign wealth fund Temasek to partner with transportation giant Kuehne + Nagel to create a $50 million venture capital fund to support logistics and supply chain startups. According to fund director Mark Dragon, expectations are rising: there is no doubt that technology will bring new, highly efficient ways of working with supply chains.
There are also companies looking to expand their technology portfolio in-house. For example, C.H. Robinson Worldwide, the largest freight broker in North America, has announced that it will double its technology spending to $1 billion to expand and grow its range of services to withstand competition from digital startups. In addition, demonstrating a commitment to quickly adapt to digital innovation, Deutsche Post DHL Group announced in October 2019 that it plans to invest $2.2 billion in digital initiatives through 2025. With so many partnerships created over the past year, it will be interesting to see what solutions emerge from these investments in 2020.
Technology-driven sustainability
Sustainability is a trend that is seen across all industries, and logistics is no exception. In particular, last mile logistics has traditionally been very time and energy consuming, and therefore also provides many opportunities to find and apply new intelligent approaches. To reduce their environmental footprint, companies are using a variety of technologies, from electric vehicles to AI-based software that calculates the route with the least emissions.
Amazon recently announced its “Climate Pledge” to reach the goals of the Paris Accords 10 years earlier. By doing so, the company hopes to encourage other businesses to join the agreement and aims to achieve net zero emissions across all of its operations by 2040, as well as promote renewable energy.
Deutsche Post, the world’s largest courier company, has also committed $552 million to the production of light commercial vehicles and small electric vehicles. A partnership with a Chinese manufacturer will enable the production of up to 100,000 street scooters per year.
Similar trends in logistics technologies are observed throughout the transportation segment. More recently, more than 60 groups, including Maersk, launched an initiative aimed at zero-emission ships and marine fuels on the high seas by 2030. These efforts are of fundamental importance, not only because of their direct impact, but also because they inspire the entire industry to become sustainable.
Autonomous vehicles
Even though autonomous vehicles, be they trucks or drones, are closely linked to the near future of logistics, in 2020 we will probably only see them in the testing phase. However, it is one of the most talked about logistics technology trends in recent times.
For example, UPS Ventures has invested in autonomous car company TuSimple. The companies are testing self-driving vehicles in Arizona to determine if these vehicles can improve service and efficiency at UPS. That means UPS and TuSimple are joining the likes of Daimler, Tesla, Starsky Robotics, Einride and Embark in their goal of eliminating drivers in trucking.
Companies are starting to see the potential of autonomous vehicles in unexpected areas, such as fleet maintenance. Austrian Airlines uses drones to perform routine maintenance tasks and to document any potential damage outside of the aircraft. This can not only reduce maintenance costs, but also reduce the burden on technical staff. As more and more drones are seen by companies as a means of delivering small packages, it’s no surprise that there will be more trial runs and pilot projects in 2020. UPS will become the first American nationwide airline to use drones.
Robotic warehouse equipment
Without a doubt, warehouse operations have undergone significant changes in recent years. This is one of the logistics technology trends that will continue. Robotic warehouse equipment is a rapidly growing field. Robotics testing in warehouses increased by 18% year-over-year, according to the 2019 Global Customer Report. Boston Dynamics’ mobile warehouse robot, Handle, is one notable example: the company has developed a fully autonomous, compact robotic device used to unload vehicles, haul cargo, and move crates throughout a warehouse.
Whether it’s wearable technology, autonomous driverless vehicles, or multi-functional robots, robotization can greatly increase the efficiency and speed of warehouse processes. Companies such as GreyOrange and Locus Robotics are already incorporating robots that move around the warehouse on their own. Thanks to machine learning technologies and sensors that provide extreme accuracy and ease of tracking, more autonomous robots will appear in warehouses around the world in 2020.
International road freight transportation in Ukraine, as well as international sea freight container transportation, is successfully carried out by M&M Ukraine (head office in Kiev, subdivision in Borispol and Odessa) in all promising and demanded world directions . “M&M Ukraine” provides high-quality and safe cargo transportation from China to Ukraine, from Ukraine to China, to Europe and to the USA.
Based on http://www.transmetrics.eu/ and open sources.