Melbourne’s ITS World Congress 2016 was a mind-blowing experience for someone getting up-to-speed with the latest in a fast-changing field.
With 12,000 delegates from 73 countries, this annual event tracks the rapid progression in Intelligent Transport Systems (ITS), where leading players show how new transport technologies are disrupting business models across the globe.
No longer science fiction or 5-10 years away, ITS is already here, and not just in big cities like London, Singapore and San Francisco. Smaller places like Milwaukee, Ohio and Estonia are showing that Intelligent Transport Systems can be applied anywhere for those willing to collaborate and share value in new ways.
Visions of Transport’s Future:
ITS offers a vision of seamless transport of people and goods by connecting all elements of multimodal transport – passengers, freight, vehicles, information and communications technologies and infrastructures – in a digitally integrated system.
The National Transport Commission believes five disruptive technologies will change transport systems over the next 25 years:
- Big Data analytics
- The sharing economy
- Zero emission vehicles
They see fleets of driverless vehicles providing on-demand shared passenger and freight transport services with a dramatic reduction in private vehicle ownership and the number of vehicles on our roads. Government reliance on fossil-fuel-based revenues to fund transport infrastructure is in jeopardy from relentless fuel-efficiency gains even before electrified vehicles (EVs) emerge, inevitably needing ‘user pays’ road pricing based on when, where and how people use roads.
Then there’s Gartner’s three key emerging digital technology trends for the next 5-10 years:
- Transparently immersive experiences, such as brain-computer interfaces, augmented and virtual reality;
- Perceptual smart machines, where radical computational power enables machine learning, artificial intelligence, autonomous vehicles/drones and smart robots;
- The platform revolution, allowing organisations to connect with new business eco-systems that exploit internal and external algorithms to generate value, including quantum computing, Blockchain and Internet of Things (IoT) platforms.
Add to this picture a series of global Megatrends: urbanisation; online retail with free, fast shipping globally; decarbonisation and green finance; mobile connectedness; and social media, to name a few, and you get an explosion of new business models enabled by technology and collaboration that change the very nature of how people and freight move today.
What will this mean for Freight?
How will freight movement be transformed, and how will transport operators need to change their traditional thinking? Some opportunities include:
Smart GIS: Geographic Information System (GIS) mapping provides content and context about everything, where everything that moves or changes is measured and reported real-time to networks in geospatial frameworks. Advanced space/time analytics enable Big Data visualisation for supply chain design using simulations, enabling new types of collaboration across networks of individuals and organisations using shared-information services. Daimler, BMW and Audi now jointly own the HERE map technology business whose map data is used by four out of every five cars in world today. Daimler has made it an open platform to encourage innovation to optimise use of infrastructure, with interesting possibilities for its truck brands.
Automated & connected vehicles: Supervised autonomous driver assistance systems; truck platooning; restricted-access route choice systems using infrastructure sensors to manage and monitor compliance; Truck drivers become Operators that are advised what to do, where to go and how fast to drive by voice-guided navigation and live sight augmented reality, which may help attract drivers to the industry. That’s if the vehicle isn’t driverless, as many road, rail, water, air, port, terminal and warehouse vehicles and equipment will be, always in the most fuel-efficient driving mode. Uber Freight’s self-driving truck acquisition, Otto, recently partnered with Volvo to complete its first shipment of Budweiser beer.
Freight matching: Uber has released its freight platform that matches trucks with the right load wherever they are, aiming ultimately for a self-driving freight system. Both uShip and Australia’s yojee run online freight marketplaces, while Convoy has contracted 10,000+ regular scheduled shipments per year for Unilever in addition to on-demand deliveries.
Urban freight: Better use of infrastructure capacity will take serious private-public collaboration. Technology helps negate barriers: EVs are quiet and safe to help extend off-peak deliveries; vehicle routing systems provide real-time congestion and cargo updates to combine with loading dock/zone scheduling to optimise flows; consolidating loads via matchmaker systems maximises equipment utilisation for fewer empty or under-utilised trips; and what about last-mile deliveries with e-trikes or robots?
Container optimisation platforms: Melbourne start-up Opturion routes containers between wharf, container yards and transport yards using multi-source data sets to maximise efficiency within vehicle, cargo, site and route constraints.
Clean energy: Rapid advancements in light and heavy electric truck technology combined with battery energy storage and renewable power present a ‘chicken & egg’ dilemma for developing charging infrastructure networks. Nikola isn’t waiting for public investment in refuelling networks for its zero-emissions heavy duty hydrogen electric truck, planning instead to build a network of hydrogen refuelling stations fed by its own solar farms that produce hydrogen from water using electrolysis.
Insurance: Revolutionised to reduce costs, both through significantly safer vehicle operation and Telematics providing location, time and driver behaviour data to enable precise estimation of underwriting risk for lower insurance costs;
Then there’s some that don’t fit simple categories: Hyperloop One/DP World high-speed electric container transit system (possibly underwater); Blockchain crypto-technology to track financial payments, cross-border trade and freight flows; and the physical internet intended to replace current logistics models entirely with an open system routing freight using the principles of the Digital Internet.
Together, these technology-enabled business model advances offer greater asset utilisation, cheaper freight movement and happier, better-served customers.
Technologies need Collaboration
The key lesson for me is these technologies rely on collaboration to design, develop and apply into the community. Sharing knowledge and proprietary data via open access platforms is fundamental to a term used widely at the ITS World Congress – Collaborative-ITS.
Freight transport is a fragmented, diverse sector, with four modes of road, rail, sea and air transport connecting networks of transport yards, sea ports, airports, intermodal terminals, warehouses and customer distribution systems. Austroads found generating interest from industry for its urban freight improvement project very challenging, because individual freight operators believe there’s little they can do to make a difference, while for their customers freight is only a small business cost.
Yet there’s plenty of examples around the world that may inspire action here.
- Singapore is leading the way with Big Data networks. To optimise every mile of road on their small heavily populated island, the Land Transport Authority has smart sensors installed everywhere to collect transactional real-time movement information which is shared at a rate of 400 million downloads per month. They aim to enable mobility on demand services via driverless vehicles, sharing and electrification services while doubling its rail network to reduce reliance on privately-owned vehicles. What impact on collaborative freight management will this open source information sharing platform have?
- With no room to expand, Hamburg Port optimises its infrastructure by connecting IoT sensors to collect and share data with all port stakeholders via mobile devices. Real-time delay updates prevent more widespread disruption within and outside the port. Smart sensors communicate truck parking availability; connect multimodal interfaces between ship, road, rail and movable bridges; and connect truck drivers to traffic lights to prioritise cargo movements.
- The US state of Iowa’s Department of Transport conducted a supply chain design model for all products moving in the State at a zip code level using bill of lading data in a massive public and private sector data gathering and analysis exercise. Finding a clear need to better consolidate freight, with a private partner it’s developing the Cedar Rapids Logistics Park with intermodal cross-dock rail/river/highway access which will return a benefit of US$26.53 for every dollar invested.
Disruptors are coming from outside the transport industry, blindsiding traditional players. Partnerships with and between outsiders such as Google, UBER and Tesla abound, moving smart/shared concepts forward using technology. Amazon is building its own logistics business, buying branded truck trailers, leasing freight aircraft and building warehouses (opening 23 globally in Q3 2016 alone) to “control its own destiny” as well as serve other retailers and consumers. Even within the traditional players, disruption is underway. Deutsche Post DHL now makes its own electric vehicles enabled by open automotive standards, bypassing auto-makers to deal directly with their suppliers to build new tailor-made delivery EVs that they may even sell to other logistics providers.
Freight’s intelligent future
Future freight transport is automated, connected, shared, safe and clean. It’s all about data. Epic advances in volume and speed to generate, process and store data will fundamentally change goods movement.
Data overload and digital fatigue already hold back many from embracing new analytical capabilities that can create value for customers. Yet it’s riskier to do nothing or use Digital simply to protect existing business models.
We can continue to work around inefficiencies we see in the freight transport system every day, or join with progressive people to embrace an ITS future. To solve systemic challenges, we can do more together than we can alone.