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How Disruption Is Changing The Face Of Trucking Industry – Is Trucking Safe?

The semi-autonomous truck has seen plenty of play in trucking headlines of the day. As manufacturers continue to embrace advanced technologies, change is the name of the game.

While no one expects an autonomous truck to displace a truck driver and get a load from point A to point B any time within the next five to ten years, industry is upbeat on the technology.

Still, should we be taking a step back to evaluate every aspect of a new technology before we move forward with industry-wide adoption? Perhaps.

The Evolution of Commerce

The fact is, a hundred years ago commerce happened at a far slower pace. Still, societal transformations continued unabated. The steam engine played a huge part in spawning an industrial revolution that would transform the world.

Then, the Interstate Highway System opened veins of potential throughout North America and suddenly places inaccessible by trains could be reached by tractor-trailers. Rural parts of the country had a new lifeline as the nation’s infrastructure built out.

Now we’ve entered a new era of technological innovation. How can we keep the technologies of today from completely undermining our established ways of life?

Some, such as Microsoft founder – and world’s richest man – Bill Gates have gone so far as to suggest that when a company displaces a human worker, they should pay a special tax for doing so.

When he advocated for the new tax, Gates received much criticism from both his peers and others in business who were fundamentally opposed to new taxes. Still, it never hurts to look at differing viewpoints on a topic, and this one certainly relates to business done within the trucking industry.

Advocating for new taxes is never a popular idea, which is why we won’t see that plan materialize any time soon. If anything, we are currently in an anti-tax and anti-regulatory era. This is not a treatise on whether this shift is good or bad, but is merely an acknowledgement of it.

Will it happen? Will the two sides somehow come together and figure out how to manage the transformation of industry and automation?

We’re going to take a deeper look at this debate and try to answer this question in a logical and factual manner.

Looking Back in Time

Before we continue, we should take a brief look back in history, when the principles of capitalism, industrialism and wage-paid labor combined to transform the way Americans practice commerce. It would transform into the modern business/industry/manufacturing behemoth we see today. Free market capitalism, in its essence, built the pillars of our current society.

Commerce and the movement of good and service has always been critical to maintaining that paradigm. Since the beginning, the supply chain has carried the lifeblood of the society of man and machine.

The thing with capitalism is that it always contained an element of competition, and not just where competition from other companies was concerned, but from within the workplace itself. And this wasn’t necessarily a bad thing.

Workers soon realized they were free to leave for other companies who might offer better pay, benefits or far safer working conditions. Suddenly a new era of job competition was born. If an employee didn’t like the pay or treatment at one employer, they could seek out another.

At the same time, companies were increasingly looking for ways to control costs and fatten the bottom line. Enter the burgeoning field of automation. In a world where cost cutting meets increased production, you’ve either got to get more out of the workers you have, hire more workers, or completely change the type of worker you use.

Factories and manufacturing plants have long been putting large, complex articulating arms where humans used to stand. Even in writing, basic machine intelligences can now write an understandable “advertorial,” which is a basic piece of short writing designed to promote a product.

Fortunately, as we’ve reported on in the past, trucking is largely insulated from job loss through automation, for several reasons – at least for the time being.

Truck Drivers Wanted

Even as Daimler Trucks showcased when they unveiled their version of a semi-autonomous big rig, you still need a person. Consider you still need a person in a passenger car. As much was evidence when Google’s driverless car got into its first accident in 2016.

Granted, driverless passenger car tests have been occurring across the world for some time and the technology – for the most part – does work. But that doesn’t mean we’re a few months away from seeing a car with no one behind the wheel drive by without becoming immediately concerned.

The same goes for heavy-duty Class 8 big rigs. Testing tractor trailers in various platoon configurations has been ongoing, but consider these tests also include a truck driver in the cab of the vehicle.

Platoons have even been tested on the busy roads of Los Angeles, but still even here they used drivers, and for good reason. During one test, a car switched lanes with no signal in front of the platooned vehicles.

The trucks immediately decelerated, but the truck driver would have to intervene and hit the brake pedal, thus causing the same reaction from everyone else within the chain. Demonstrations like these show that there are still kinks within the system that need to be worked out.

Some say regulations surrounding how much control technology should be given must be at least discussed, while others say we should go forth testing and implementing new technologies. The answer likely lies somewhere in the middle.

From Uber to AirBnB and a vast number of 3D printing operations doing things as amazing as 3D-printing a fully-functional Caterpillar construction excavator – the future is now.

The industry must continue innovating. It must also welcome disruption. How industries handle disruption can mean the difference between a thriving business or spectacular flame-out. One area where it can learn the best of business adaptability is how the trucking industry has integrated itself into the world of e-commerce.

We were just talking about capitalism, so it’s important to note that industry disruption is as old as capitalism itself. Disruption. It’s the word that is on the tip of everyone’s tongue.

“Which industry will it gobble up next?” The pundits ask. Suddenly everyone is an electronic armchair quarterback. Yet, the hype is not without merit.

Businesses have been gobbled up. Titans of industry toppled as the relentless march of time plus technology change the way humans live on Earth. There are simply too many examples to count.

Whatever happened to the horse and buggy? It yielded to the automobile. Film-based cameras yielded to digital and digital may soon yield to smartphone as newer variants offer insanely low apertures.

Since the future of the trucking industry is upon us, we should make it a global conversation. Globally, the elephant in the room is e-commerce.

Trucking’s Minimal Disruption

Amazon and other online retailers have essentially upended the brick-and-mortar retail sector. They also took a huge chunk out of catalog sales, sending giant big box retailers like JCPenny and Sears to the brink of insolvency.

Remember the mall? Today the idea of a gigantic building filled with stores seems as antiquated as a drive-in movie. Today, 70 percent of all mall sales account for only 28 percent of all malls, meaning the other 72 percent of the malls out there aren’t doing very well.

Once Amazon and other e-commerce retailers introduced the idea of direct shipment of almost any product you could imagine, the entire nature of industry changed. According to ICSC statistics, year-over-year e-commerce growth in the beauty care market has grown by over $1.5 billion.

Brick-and-mortar stores? A $170 million contraction. Physical retail locations continued to shrink as the e-commerce segment expanded further, and by huge numbers no less. But what will this retail digital disruption mean for the trucking industry? Sure, we see big box stores closing, but does that mean e-commerce retailers won’t need trucks?

Ask many a fleet manager operating today and they will tell you they feel more disrupted by the ELD back-and-forth than they do by new technologies. Sure, the adoption to electronic records, video systems and migration to the “cloud” haven’t been easy, but they are necessary to moving the industry forward.

What we are likely to see are more less-than-full truckloads and a slight move to smaller, more mid-range vehicle types as trucking companies begin operating with shippers who themselves are switching to smaller, more regional warehouse strategies.

Think Amazon’s play for Whole Foods. That will give them over 2,200 locations across the country. Imagine if they turned each one into a small warehouse for essential items.

How would they deliver those items? If by truck, you may see an increase in vans or smaller box trucks. The fact is, if you want to be a successful trucking company in the 22nd Century, you must be adaptable to changing times. Will you be ready when the future supply chain of commerce comes barreling down the tunnel of today?

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