Insights · June 14th, 2022
In early-June 2022 Nikolas Badminton flew down to Nashville, Tennessee to speak at Conversion Agency‘s Sightlines Conference to present a keynote on the future of trucking and the recruitment and retention of drivers and other members of the United States’ trucking industry.
Nikolas Badminton presents 5 key trends and thoughts from the keynote on the future of trucking in the United States.
1. We are in a struggle between the new and old industrial complex
“Data is the new oil” we heard many a futurist opine. In a way this was a useful statement that indicated that the unlimited resource of data, and the tech that taps into it was the new frontier. However, this glossed over the fact that we are living in a world that is deeply entrenched in running on oil alongside of data. Here we have a view from June 2nd, 2022 on the most valuable companies in the world.
It’s a story of Big Oil and Big Tech and a picture not seen for 5 for 6 years until Saudi Aramco went public. Saudi is raking it in as the world struggles post-pandemic and the wholesale transition to electrified infrastructure is barely at a snail’s pace. It’s coming, that’s for sure. It’s going to need trillions in investment and an active retirement of old transportation and industrial infrastructure. Some of the world’s new most valuable companies will be working in the retirement and reclamation of fossil fuel equipment as part of the circular economy.
2. Cultural shifts caused by the pandemic are putting pressure on the trucking industry
Since the beginning of the pandemic we saw consumer shifting online with e-commerce sales up by nearly $219 billion between 2020 and 2021 and will grow from $5.5 trillion today to over $7 trillion in 2025. Supply chains have been squeezed and now we are seeing that 83% of North American manufacturers are likely or extremely likely to reshore (this is up from 54% in March 2020).
With 70% of all goods in the US are moved by the trucking industry – which is an USD$800m+ economic value – we’re going to need more trucks and truckers on the road. The struggle is that in 2022 there is an estimated 80,500+ shortfall in drivers needed in 2022 and this figure is forecast to reach 162,000 by 2030. We’re also seeing that there is a 92% turnover for truck drivers in 2020 for fleets with more than $30 million of annual revenue. Why is this happening?
Supply chains will continue to crunch and grind unless we get goods moving and ultimately it comes down to making the industry more attractive to join – new ways of working, better pay and conditions, and good job prospects.
3. From long-haul to regional logistics
By 2045, more that 70 million people will join the American population and freight volume will increase by more than 40%. In addition, by 2050, emerging United States ‘megaregions’ could absorb 75% of the U.S. population.
Take a look at The Weitzman School of Design presentation on ‘Megaregions and America’s Future’ by Robert Yaro, Fritz Steiner, and Ming Zhang. They take a closer look at the untapped potential of megaregions for planners, policy makers, academics, and decision makers in transportation, environmental protection, and development agencies.
With shared economies, natural resource systems, infrastructure, history, and culture, these linked networks of metropolitan areas and their hinterlands—such as the Southwestern Sun Corridor or Great Lakes—can strengthen climate resilience, natural resource management, economic competitiveness, and equity at the local, regional, and national levels in the United States. ‘Megaregions and America’s Future’ (Lincoln Institute of Land Policy/Columbia University Press) reviews the origins of the megaregion concept and the economic, ecological, demographic, and political dynamics to help readers understand trends, processes, and innovative practices within and between megaregions and identify the most pressing challenges that demand strategic decisions and actions.
As we look towards our futures, the production of goods and local shipping will be of utmost importance to boost the United States’ economy.
4. Here comes the robot trucks
The semi and fully autonomous truck market size will be USD$88 billion by 2027 (Acumen Research and Consulting) and the U.S. Department of Transportation has committed to a USD$100m plan for autonomous car research, including $60m for private company research.
Companies like TuSimple are coming to market to create autonomous networks of trucking that could help shift how the industry works by driving cost savings, efficiency and increased safety, the new operational mantra of 24/7/365 operations, consistent mileage rates, and faster freight delivery – with some touting New York to Los Angeles achievable in 48 hours vs. 5 days currently with human driver.
A.T. Kearney is also expecting that we’ll see 78% of driving availability of autonomous lorries from 2030 onwards, as opposed to 29% of the time today.
Autonomous trucking will need autonomous lanes and changes in regulations plus a cultural acceptance of driverless technology as much as there is a need for reliable and zero-risk autonomous systems. We’ll see a shift of drivers to being pilots that are remote and potential controlling platooning fully-autonomous vehicles, like DB Schenker’s Einride autonomous electric truck.
5. Trucking industry trends and the future of trucking
There is a wholesale need for cultural shifts, operations evolution, and technology and Infrastructure advances. In 2030 and beyond were likely to see:
- A shift from same-day to same-hour delivery
- 50% of fleets with some level of autonomy and trucks connecting to human-driven agile ‘last mile’ delivery in cities and regions
- Business models shifting from integration to aggregation.
- Transport volumes in warehouses are reduced and warehouse sizes decreased with smaller spokes
We’ll also see shifts in trucking industry jobs:
- Logistics pilots co-ordinating 24/7/365 long-haul trucking operations
- Hub to destination skilled drivers (an opportunity for the older workforce)
- Route planning and load optimization planners
- Urban logistics centers (Amazon et al) and multi-modal logistics
- New startups looking for driving talent to design systems and coach their autonomous trucking operations
- An increase in specialist cybersecurity companies focused on trucking infrastructure and in-house cybersecurity experts as autonomous trucking takes hold.
Transport Topics also shared a summary of the keynote in their article ‘Futurist Outlines What Could Be Ahead for Driver Recruiting’.