With weekly, if not daily, news reports about the rise of drone deliveries and autonomous vehicles, the tipping point is surely not far away when the companies developing such technology leap the final regulatory hurdles and are given permission to operate on initially a local, then regional, then global scale.
While drone technology is getting pulses raising for the way it can help tackle last-mile delivery issues, literally dropping parcels into customers’ laps, equally – if not more – exciting for the logistics industry are the potential opportunities that driverless trucks open up. Given that 75 per cent of European freight is currently delivered by road, making the mass transportation of goods cheaper and faster will have major implications for all parts of the delivery supply chain.
Trials have already taken place in America and Europe where driverless articulated lorries have completed journeys. These have either taken the form of a single vehicle driving autonomously on a highway, with a driver taking over for final stretch when it enters urban areas, or have formed vehicle platoons. The latter involves a fleet of trucks driving in ‘road trains’ where the speed and direction are synchronised by the lead vehicle, again supervised by a single driver.
The key benefits of using such methods are touted as reducing emissions and improving road safety, but if they do pass into common use the impact will be far wider ranging. Lorries will be able to move more goods using fewer drivers who, in turn, will be unconstrained by driver working hours restrictions, meaning deliveries can be made faster and with lower overheads.
Distribution hubs will also potentially be able to be located in more remote areas of Europe, as retailers and manufacturers look to take advantage of lower land costs and/or more favourable taxes or other incentives, as goods will be able to be transported from them at all hours of the day or night with no limits on journey times.
In practice, this is likely to favour areas of central and eastern Europe. These not only have lower land costs than many western European locations but are also at the bleeding edge of future consumer demand.
The UK currently leads in terms of European online retail penetration, currently standing at 19 per cent, however, other markets such as Poland and Germany are set to start catching up. With youthful consumers more likely to make purchases online than their older counterparts, being able to fulfil these orders from a semi-autonomous real estate network on the consumers doorstep will make sense to many.
This isn’t to say that other supply chains will be disbanded: retailers and manufacturers will still require warehouse space across Europe to fulfil a variety of functions. But driverless technology may see a slow gravitational shift in the centre of activity from west to east.