The future of freight: Transforming the movement of goods

Supply chain issues and production bottlenecks brought to the fore by the pandemic presented opportunities to reshape freight operations


In the years that led up to 2019, the twin rise of e-commerce and consumer expectations began placing unprecedented strain on global transportation networks and logistics providers.  Manufacturers and retailers responded by pushing their existing systems—a wide-ranging global network of tightly coordinated just-in-time production and fulfillment operations—even harder. When the pandemic hit in early 2020, demand shifted precipitously, just as production began pausing unpredictably everywhere from Dubai to Shenzhen. Simultaneously, moving goods through ports and on planes became significantly more complicated. The result: disastrous bottlenecks and price spikes that underlined the fragility of our overstretched supply chains and accelerated the urgency of rethinking leading practices for how we move goods.

Today the transportation industry is at an inflection point, as several massive shifts bear down on it at once. Nearshoring efforts are underway across a significant number of industries as companies strive to shorten and bolster supply chains. China’s dominance in global trade is expected to wane, its trade growth dropping from 26% to 13% in the next five years,2 and countries in Central and Southeastern Europe, as well as Central America and Mexico, picking up the slack with competitive labor and closer proximity to end-use markets.

These developments on their own would constitute a seismic shift in the future of freight, but they are expected to be accompanied by revolutions in data science (IoT, analytics, and artificial intelligence), material science (electric vehicles), and engineering (autonomous vehicles). Every shift represents an opportunity for new competitors to enter the market, as startups, megaretailers, and hyperscalers all vie for a piece of the trillions of dollars at stake.

Deloitte’s research reveals a transportation industry poised for significant transformation, where success will be determined largely by the ability to deftly navigate five major forces. These combine to present major challenges and opportunities for the transportation industry.

Click here to read full article…

Similar Posts