Digitise this: transforming global transport
29 Jan 2018 Geneva
We stand today at the edge of unprecedented change that will re-shape how we transport goods and people in the future.
Innovation and digital services are re-shaping the world as we know it, but when it comes to mobility, despite considerable improvement over the years, the basics have remained the same. Too much of transport is paper based, and where data is available electronically, its sharing is highly limited. Sometimes, this is for good reason, such as data protection, but more often it is caused by a lack of interoperability and business connections.
Digital services are re-shaping the world as we know it
Highly automated vehicles and ultimately self-driving vehicles will come. Warehouse automation is already upon us, where robots are working in synchrony with humans to provide faster packaging and dispatch. Blockchain is being tested for mobility services, while wide scale vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) communication is in the works. E-commerce is experiencing incredible growth.
All of these changes are enabled by digital technologies.
The digital storage and sharing of data is the key to reaching transport optimum, where all shipments can be well planned so that every truck on the road has a full load, is using the optimal route, and is seen as an integral part of the supply chain.
Simply put, innovations in load matching, platooning, intelligent transport systems, eco-driving – all increase efficiency without reducing capacity. So as freight demand rises and fossil fuels dwindle, innovation offers a sustainable paradigm shift.
But let’s start with the basics.
Rising momentum for e-CMR – digital consignment notes
In road transport, CMR consignment notes are one of the key documents for cross-border operations. There are some 150-200 million CMRs and other consignment notes used annually in Europe for international trips, with this number skyrocketing to approximately one billion if national freight transport is included.
Aside from the environmental implications of using paper, some 38%-44% time could be saved on administration regarding the filling in, formatting, printing, checking, signing, and cross-checking of CMR. As an example, in Scandinavia, this would be a saving of around three Euros for each paper CMR used.
While CMR is highlighted above, the message is the same for customs transit systems like TIR and all other transport documents.
Electronic documents and data sharing will increase transparency, accuracy and speed of business processes. Today it is unfortunately not uncommon for payments to be delayed by days and sometimes weeks because transport operators need to show signed CMR papers. In a business that depends on profit margins in low single digits, cash flow is often an issue for daily survival.
Taking BLG Automative Logistics as an example, the company uses two million sheets of paper to transport one million vehicles per year. For the whole of Europe this equates to 16.5 million vehicles transported and 33 million sheets of paper.
That is a potential 135 tonne saving of wood each year. With 14.5 million tonnes transported by trucks (figure of 2015) in Europe – it represents an entire ecosystem.
In addition to the highly important aspects of saving forests by using less paper, and enabling economies to grow through increased transparency, accuracy and speed, digitalisation has indirect benefits for road safety.
The iHeERO European project has shown that emergency alerts (eCall) can be connected to real-time data information sources, such as e-CMR services, to instantly inform rescue teams not only about position and type of truck but also about type of goods carried should a truck get involved in an accident. This would allow emergency services to better address and react to a potential accident involving trucks.
Momentum for e-CMR is growing – and the more countries that sign up to it, the wider the benefits
Momentum for e-CMR is growing – and the more countries that sign up to it, the wider the benefits. A number of countries in Europe and Eurasia are pushing for it, and the UN and EU are strongly advocating digital transport documents and data sharing. Luxembourg and Iran were the two latest countries to accede to the e-CMR additional protocol, demonstrating that when it comes to digitalisation, there are no limits.
Reinventing the formulas – but not the wheel: learning from global best practice
2018 will be a milestone year for defining the rules on data privacy. The General Data Protection Regulation (GDPR), developed by the European Commission, is entering into force on 25 May and will impact every single company which aims to keep databases of clients or users. Companies not compliant with GDPR may face serious financial penalties. All providers of digital services will need to comply, from freight exchange platforms and transport operators to providers of innovative dash-cam solutions for road safety.
Another big change in Europe will be the introduction of European Electronic Tolling Systems (EETS), which aim to ensure interoperability of road user charging between different countries. This will mean that the number of road user charging boxes in trucks will be reduced (ideally to only one) and that processing of payments will be simplified.
Against this context of fundamental change in the logistics landscape, global exchange of best practice is crucial.
Against this context of fundamental change in the logistics landscape, global exchange of best practice is crucial
While Europe and Eurasia make clear steps towards the adoption of digital transport documents, these regions can learn from the practical experiences of Brazil and Mexico. In both of these countries, transport consignment notes have been electronic for several years now, providing increased transparency between stakeholders and simplifying compliance with regulatory processes.
Looking at the US road transport system, the main digitalisation effort in the past few years has been the introduction of Electronic Logging Devices (ELD). From 18 December 2017, ELD have been mandatory on all trucks operating in the US. This introduction, supported by IRU member, American Trucking Associations (ATA), was preceded by discussions on topics such as how ELD data will be used by the authorities and how data security will be ensured. While different in its implementation from European digital tachographs, which have been in place for many years, both solutions share the same purpose of recording driver time and occupation. In this case, European experiences can alleviate potential fears by offering their lessons to American colleagues to demonstrate the benefits on the ground.
Taking one example, the average time for finding cargo was reduced from 2.27 days to 0.38 days
I was also very pleased when the intelligent logistics information platform, YMM, recently became an IRU member. YMM is the first domestic cargo transportation dispatch platform in China to fully utilise the latest technologies in cloud computing, big data and mobile internet. It has more than 3,900,000 registered heavy truck drivers and more than 850,000 registered cargo owners. The efficiency benefits of managing such vast numbers of transport stakeholders are staggering. Taking one example, the average time for finding cargo was reduced from 2.27 days to 0.38 days.
Great digitalisation examples can also be found in different parts of Africa, where freight exchange platforms are booming and the phone-based banking and payment system, M-pesa, is used to pay for goods deliveries. As I have already said, there are no digital limits: M-pesa has been introduced on other continents as well.
Future-proofing our industry
These elements are just the tip of the innovation and digitalisation ice-berg in the unsettled seas of the road transport industry. Each of them deserves a deeper analysis and reflection and IRU is taking the lead to provide the industry with a platform to learn and to navigate these waters. 2018 heralds two major gatherings for industry leaders, both focusing on innovation and digitalisation.
Two major gatherings for industry leaders, both focusing on innovation and digitalisation
The IRU Logistics & Innovation Solutions event will be held on 12 April in Amsterdam, where IRU in cooperation with its members, will bring together the road transport and logistics industry to present the latest digital solutions, such as freight exchange platforms, EETS, electronic documents, new telematic features and data sharing practices. The event will also enable transport operators to learn about the most recent and future requirements on transport operations from major shippers and e-commerce platforms. Finally, transport operators will also be able to share experiences with each other and establish mutual business links, as well as with key international shippers and prominent service providers.
The IRU World Congress – Innovation on the Move – will be held in Muscat, Oman, 6-8 November, and will gather the industry to debate the challenges we face in road transport and trade, with key findings from innovation leaders, companies, governments and associations to help pinpoint best-practice methods and learn how to replicate them. Oman, with its goal to become a leading regional logistics hub, offers immense opportunities for demonstrating the latest, world-class, innovative solutions.
The world will not be ready for driverless trucks without a fully digital logistics infrastructure
Innovation and specifically digitalisation, is not a single solution, product or a service. It is a global revolution that is impacting every single aspect of road transport. It is a revolution that we must embrace to ensure the sustainability of road transport operations as we look to the future.
As an industry, the road transport sector must bridge the gap between headline grabbing innovations, such as driverless trucks, and the reality on our roads today. We need to show clearly how all of these digital steps are building a path towards a sustainable future.
To quote IRU Secretary General, Umberto de Pretto, "The message is simple. The world will not be ready for driverless trucks without a fully digital logistics infrastructure."
Zeljko Jeftic, IRU Head of Global Innovation
Zeljko Jeftic is Head of Global Innovation at IRU, leading the organisation’s engagement with its members and the wider industry on Innovation and Services. Zeljko has an engineering background with experience gained in telecommunications at Ericsson, and in the development of active road safety solutions (which today form the basis of the evolution of autonomous vehicles) at Volvo Group.
Zeljko then joined ERTICO – ITS Europe as Senior Project Manager on European R&D projects related to connected vehicles and cooperative vehicle-to-vehicle (V2V) and vehicle-to-infrastructure (V2I) services focusing on energy efficiency. In 2013, he joined IRU where he lead the establishment of the IRU Projects team, which is working on delivering solutions and knowledge for improved road transport through multiple private-public partnership initiatives.