Imagine it was the year 2000 and we are having a conversation about technology. Let’s say I told you that in 15 years’ time you would have a device that fits in your pocket, can tell you where the nearest restaurant is to your location and how good the food tastes and that you would have more computing power than your current desktop computer. You might possibly think I was nuts or just nod politely and then go about your day as usual.
Technology is changing the way we interact with one another and how we do business. Visibility and information is at your fingertips 24 hours a day. Now when it comes to the freight industry it isn’t exactly an early adopter and it would be fair to say…..a laggard. Automation has replaced jobs in warehouses and created other jobs to manage the technology. What you see is general labour jobs atrophying and being replaced by machines and robots. These types of jobs are not coming back, despite what some may want you to believe.
Technology will continue to impact the freight industry similar to how mobile phones changed the way we interact with one another and how quickly information can be obtained. There were early adopters and then those who waited until they knew the technology was proven and jumped right in.
The biggest challenge in the freight industry is how fragmented the market is and how many different platforms and technologies are out their claiming they are going to revolutionize the industry. Trucking companies that have 20 or less trucks make up approximately 95% of the 1.5 million trucking companies in the US and Canada. I am not saying that technology is not going to impact the industry. I just don’t see a massive change like the adoption of mobile phones unless 1.4 million companies all agree to adopt the same platform with a more or less even playing field.
Technology has provided transparency to rates, transit times and better decision making through business intelligence, but this is not automation with driverless trucks replacing 3.75 million truck drivers in North America anytime soon. The biggest roadblock is trucking companies agreeing on how the future will look and what technology to adopt if there is going to be a revolution. Our outlook is brokers, trucking companies, SAAS providers, 3PL’s and 4PL’s will continue to bring value to the organizations they serve due to the verticals and areas they align and bring value to.
Currently the industry can’t figure out how ELD’s (Electronic logging devices) that will become a requirement by December 2017 are going to impact freight rates. It depends on many other economic factors and legislation combined with the ELD mandate. To be sure, the freight industry as whole will change, to what extent really depends on how the players choose to move forward. If the fragmentation and disorganization of the industry persist; then it remains to be seen how a massive sweeping change will suddenly revolutionize the way freight is moved.