The transport sector goes beyond their traditional role of simply moving freight. It is reinventing themselves by creating differentiated products through digital innovation. Today, a trucking organization operates as a high-tech company concentrating its activities on digital and data. The pace of innovation and disruption will only increase and will mainly come from zero-emission technologies and software. As the auto market springs into action, there are four emerging trends that will amplify and potentially disrupt the market in the coming years. Autonomous vehicles, smart connectivity, big data and analytics and electrification are poised to become the game changers.
Autonomous vehicles: It is a well-known fact that self-driving cars have missed many deadlines in the past decade. Fully self-driving cars are still not widely available and accepted. The goal of fully autonomous vehicles was quite simple: safety, comfort and total cost of ownership. The business case for driverless vehicles is stronger in the commercial vehicle space than for passenger cars and is less “complicated”. One of the largest costs for commercial vehicles is the driver, both from a cost and availability perspective. There are strict rules about how many hours the drivers are allowed to drive a commercial vehicle at a time. This limits the use of the truck or bus. If we had fully autonomous trucks, this problem would go away.
The positive results of all the innovation and development tested for decades are finally starting to pay off. With the safety and cost-efficiency they offer, autonomous trucks could become a norm much earlier than the cars.
There are two different strategies around autonomous trucks: End-2-End including last mile and hub-2- hub where last mile is not included. I believe that hub-2-hub has a much higher chance of being a reality in the near future because it is more manageable from a technological point of view and offers maximum return on investment. This basically focuses on providing truly driverless hub-2 hub trucks that are: along the highways. Implementing a self-driving vehicle technology on highways is much easier than implement in the city limits.
The autonomous truck market is undergoing a transformation, maintaining the ability to create more than USD 100 billion worth over the next decade. The autonomous or self-driving vehicles are the ultimate benchmark for technological progress – we started with fully manual vehicles, until now partially autonomous and are sliding towards fully self-driving vehicles.
With the production and development of autonomous trucks, the commercial market landscape will change. It is obvious that logistics companies will offer TaaS – Truck As A Service. Autonomous vehicles thrive on RADAR detection technology, light detection and distance technology (LiDAR) and AI that detects a vehicle within a 60m radius and allows the vehicle to create an active 3D map of its environment.
Connectivity: The biggest reason smart vehicles are considered better than the conventional ones is connectivity. They are literally data centers on wheels, with an always connected paradigm. It empowers the driver to enhance the driving experience by making it effortless, convenient and highly efficient in preventing traffic accidents.
It also enables fleet management to minimize costs and risks. At the same time, it improves time efficiency, profit and productivity. Connectivity helps optimize fleet routing, security and performance. Effective telematics ie remote communication technology consists of a fleet management software system. It reads the vehicle data and enables GPS diagnosis using multiple IoT implementations so that the vehicle can be tracked, monitored and managed.
The next set of revenue streams for those companies operating in the transportation industry will come from services delivered around the truck and surrounding logistics ecosystem. These services will be built around connected vehicles that have the ability to send/receive data to/from the vehicle in real time. Organizations that successfully stay connected to end customers and provide them with value-added services built around data and connectivity will be the ones to emerge as industry leaders.
Big data and analytics: Every automaker is reinventing itself as vehicle supremacy shifts from horsepower to computing power. In recent years, digital contact points for vehicles have multiplied, and the pandemic has further exacerbated this trend.
With IT companies creating open-source vehicle architecture platforms, digital adaptation in the automotive industry has been simplified. It has even encouraged car manufacturers to create custom IT software systems according to their needs and desires.
With big data and analytics, vehicle decisions that were previously considered important and complex are now made automatically. Vehicle data is used for predictive maintenance, creating emergency alerts and informing managers about their fleet (fleet tracking). Predictive analysis is performed to forecast future demand and improve logistics.
Getting value from data is difficult – the most important and critical aspect of this paradigm is asking the right question. If we don’t ask the right question, the value of the data remains a potential and cannot be updated.
Electrification: It’s no surprise, then, that the world has rapidly embraced electric vehicles. Rising concerns about fossil fuel pollution and the development of EV infrastructure are two key factors that have increased the momentum towards EV penetration. Electrified vehicles are becoming more viable and competition in space is only increasing. The countries that have stricter emissions regulations and offer incentives have a higher adoption rate, especially for commercial vehicles. Continuous improvement of batteries (the latest of which is fuel cell) and cost effectiveness will lead to increased market share of EVs in the future. Software will play an important role in differentiating from the competition as many simplify vehicle complexity on the mechanical and electrical side as the focus on innovation shifts to software.
Future of mobility
The industry is at a turning point where trucking companies are reinventing their organizations by leveraging digital technologies. They are becoming more software companies and less conventional brick-and-mortar companies. The mobility-powered vehicles of the new era are transforming and reshaping the way business is done. Logistics fundamentals are redefined according to the innovations in software to create new business models. The advanced technology-driven fleet is cherished and quickly accepted in the market because it is both sustainable and profitable. The whole way people and goods travel from point A to point B has changed and the industry continues to evolve.
The above views are those of the author.
Views expressed above are the author’s own.
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